Taking everything into account, ORLY scores 5 out of 10 in our fundamental rating. ORLY was compared to 121 industry peers in the Specialty Retail industry. ORLY scores excellent on profitability, but there are some minor concerns on its financial health. ORLY is quite expensive at the moment. It does show a decent growth rate.

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

ORLY had positive earnings in the past year.
In the past year ORLY had a positive cash flow from operations.
In the past 5 years ORLY has always been profitable.
Each year in the past 5 years ORLY had a positive operating cash flow.

1.2 Ratios

ORLY has a Return On Assets of 15.26%. This is amongst the best in the industry. ORLY outperforms 93.39% of its industry peers.
ORLY has a Return On Invested Capital of 34.84%. This is amongst the best in the industry. ORLY outperforms 99.17% of its industry peers.
ORLY had an Average Return On Invested Capital over the past 3 years of 40.10%. This is significantly above the industry average of 12.37%.
The last Return On Invested Capital (34.84%) for ORLY is well below the 3 year average (40.10%), which needs to be investigated, but indicates that ORLY had better years and this may not be a problem.

		Industry Rank	Sector Rank
ROA	15.26%
ROE	N/A
ROIC	34.84%

ROA(3y)16.72%

ROA(5y)16.75%

ROE(3y)N/A

ROE(5y)N/A

ROIC(3y)40.1%

ROIC(5y)37.89%

1.3 Margins

The Profit Margin of ORLY (14.22%) is better than 96.69% of its industry peers.
ORLY's Profit Margin has been stable in the last couple of years.
With an excellent Operating Margin value of 19.30%, ORLY belongs to the best of the industry, outperforming 96.69% of the companies in the same industry.
ORLY's Operating Margin has been stable in the last couple of years.
ORLY has a better Gross Margin (51.47%) than 78.51% of its industry peers.
In the last couple of years the Gross Margin of ORLY has remained more or less at the same level.

		Industry Rank	Sector Rank
OM	19.3%
PM (TTM)	14.22%
GM	51.47%

OM growth 3Y-3.98%

OM growth 5Y0.56%

PM growth 3Y-4.2%

PM growth 5Y0.83%

GM growth 3Y-0.94%

GM growth 5Y-0.75%

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ROA

ROE

ROIC

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2. Health

2.1 Basic Checks

The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so ORLY is creating value.
Compared to 1 year ago, ORLY has less shares outstanding
Compared to 5 years ago, ORLY has less shares outstanding
ORLY has a better debt/assets ratio than last year.

2.2 Solvency

An Altman-Z score of 4.31 indicates that ORLY is not in any danger for bankruptcy at the moment.
With an excellent Altman-Z score value of 4.31, ORLY belongs to the best of the industry, outperforming 84.30% of the companies in the same industry.
ORLY has a debt to FCF ratio of 3.79. This is a good value and a sign of high solvency as ORLY would need 3.79 years to pay back of all of its debts.
ORLY has a Debt to FCF ratio of 3.79. This is in the better half of the industry: ORLY outperforms 71.90% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	N/A
Debt/FCF	3.79
Altman-Z	4.31

ROIC/WACC3.63

WACC9.6%

2.3 Liquidity

A Current Ratio of 0.76 indicates that ORLY may have some problems paying its short term obligations.
ORLY has a Current ratio of 0.76. This is amonst the worse of the industry: ORLY underperforms 86.78% of its industry peers.
A Quick Ratio of 0.11 indicates that ORLY may have some problems paying its short term obligations.
Looking at the Quick ratio, with a value of 0.11, ORLY is doing worse than 95.04% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	0.76
Quick Ratio	0.11

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has been growing slightly by 7.12% over the past year.
Measured over the past years, ORLY shows a quite strong growth in Earnings Per Share. The EPS has been growing by 17.85% on average per year.
Looking at the last year, ORLY shows a small growth in Revenue. The Revenue has grown by 6.19% in the last year.
Measured over the past years, ORLY shows a quite strong growth in Revenue. The Revenue has been growing by 10.48% on average per year.

EPS 1Y (TTM)7.12%

EPS 3Y9.35%

EPS 5Y17.85%

EPS Q2Q%11.74%

Revenue 1Y (TTM)6.19%

Revenue growth 3Y7.83%

Revenue growth 5Y10.48%

Sales Q2Q%7.82%

3.2 Future

Based on estimates for the next years, ORLY will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.79% on average per year.
The Revenue is expected to grow by 5.86% on average over the next years.

EPS Next Y11.89%

EPS Next 2Y11.65%

EPS Next 3Y11.27%

EPS Next 5Y9.79%

Revenue Next Year6.6%

Revenue Next 2Y6.7%

Revenue Next 3Y6.54%

Revenue Next 5Y5.86%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 34.34 indicates a quite expensive valuation of ORLY.
ORLY's Price/Earnings is on the same level as the industry average.
ORLY is valuated rather expensively when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
ORLY is valuated quite expensively with a Price/Forward Earnings ratio of 29.37.
Compared to the rest of the industry, the Price/Forward Earnings ratio of ORLY is on the same level as its industry peers.
ORLY's Price/Forward Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 24.26.

		Industry Rank	Sector Rank
PE	34.34
Fwd PE	29.37

4.2 Price Multiples

ORLY's Enterprise Value to EBITDA ratio is in line with the industry average.
ORLY's Price/Free Cash Flow is on the same level as the industry average.

		Industry Rank	Sector Rank
P/FCF	53.6
EV/EBITDA	23.05

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates ORLY does not grow enough to justify the current Price/Earnings ratio.
ORLY has an outstanding profitability rating, which may justify a higher PE ratio.