Stock Strategist Industry Reports

O'Reilly's in the Pole Position

Zain Akbari, CFA

We believe the market underappreciates the distribution advantage that the auto-parts retailers we cover-- Advance Auto Parts (AAP),  AutoZone (AZO),  Genuine Parts (GPC), and  O'Reilly Automotive (ORLY)--have over their smaller rivals. This strength is a key contributor to our narrow economic moat rating for these companies.

Sentiment remains fixated on the threat of disruption from Amazon (AMZN), which we believe is overstated, and we think a cyclical industry slump has made the buying opportunity more attractive.

Zain Akbari, CFA does not own shares in any of the securities mentioned above. Find out about Morningstar's editorial policies.