O’Reilly Earnings: Industry-Leading Distribution Continues to Deliver Organic Growth

We expect to increase our fair value estimate of $700 per share by a low-single-digit percentage for narrow-moat O’Reilly after the company reported strong third-quarter results highlighted by robust top-line growth. Over the last three months, shares have declined by about 4%, better than the Morningstar US Market Index’s 9% decline and worse than narrow-moat AutoZone’s 1% decline. Still, shares look overvalued, as we think the current price sets a lofty bar for even the best operator in the sector in O’Reilly.