Earnings Preview: O'Reilly Automotive

O'Reilly Automotive (ORLY) is expected to report Q3 earnings after market close Wednesday, October 29, with a conference call scheduled for Thursday, October 30 at 10:00 am ET.

Guidance

Analysts are looking for a profit of 40c on revenue of 1.13B. The consensus range is 34c to 47c for EPS, and revenue of $723M to $1.19B, according to First Call. In its Q2 earnings release O'Reilly reported EPS 48c compared to consensus 48c, and revenue of $704M compared to consensus $702M. At that time the company also lowered its FY08 EPS view $1.50 to $1.54. Possible revenue drivers for this quarter include the CSK acquisition. Negatives for the quarter are the economic slowdown and high oil prices at the beginning of the quarter.

Analyst Views

On September 25 Gabelli noted that O'Reilly Automotive's main drivers are still positive. Gabelli believes that overall miles driven per vehicle will increase about 1% over the long-term, and they think that O'Reilly is less cyclical than other retailers. The firm expects the company's revenue to grow an average of 14% per year over the next five years. Gabelli maintained their Buy rating. On October 8 Banc of America lowered its estimates for auto parts retailers including O'Reilly. The firm lowered its price target on the shares to $29 from $31.