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O'Reilly Automotive director sells over $17 million in company stock

Published 01/08/2024, 21:36
ORLY
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In a recent move, Gregory D. Johnson, a director at O'Reilly (NASDAQ:ORLY) Automotive Inc. (NASDAQ:ORLY), sold a significant amount of company stock, totaling over $17 million. This transaction was executed on July 31, 2024, and reported in a regulatory filing with the SEC.

Johnson offloaded 15,364 shares at a price of $1,136.16 each, resulting in an aggregate sale of approximately $17.46 million. This sale has reduced his direct holdings in the company to 5,016 shares. It should be noted that this total includes 173 unvested restricted share awards and 4,843 shares held directly by Mr. Johnson, as indicated by the footnotes in the filing.

On the same day, Johnson also acquired shares through the exercise of stock options, a common practice for company insiders. He exercised options for 9,031 shares at a price of $451.84 and another set of options for 6,333 shares at $660.48, with the total value for these transactions amounting to approximately $8.26 million. These transactions reflect a price range for the acquired shares between $451.84 and $660.48.

The report also mentioned that Johnson has indirect ownership of 980 shares through the company's 401k plan.

Investors often monitor insider transactions as they can provide insights into how executives view the company's stock and its future prospects. While the sale of a large amount of stock by an insider may raise questions, it is not uncommon for executives to exercise options and sell shares for personal financial reasons.

O'Reilly Automotive Inc. is a well-known retailer in the auto and home supply stores industry, with its business address located at 233 S. Patterson Ave, Springfield, Missouri. The company's stock is traded on the NASDAQ stock exchange under the ticker symbol ORLY.

In other recent news, O'Reilly Automotive reported second-quarter earnings per share (EPS) of $10.55, falling short of the estimated $10.83 and the consensus of $10.98. The company's comparable sales growth of 2.3% also did not meet the consensus expectation of 3.0%. Amidst these developments, O'Reilly Automotive revised its full-year 2024 guidance, now anticipating EPS to be in the range of $40.75 to $41.25, and expects comparable store sales growth to be between 2% and 4%. Despite these adjustments, Jefferies noted that softer comparisons in the second half of the year could help to limit potential downside risks.

In response to these results, several analyst firms adjusted their price targets for O'Reilly Automotive. Jefferies increased its price target to $1,260, while RBC Capital reduced its target to $1,115. DA Davidson raised its price target to $1,275, and Truist Securities increased its target to $1,204. Barclays (LON:BARC), however, maintained an Equalweight rating and a price target of $986, citing potential demand challenges.

On the expansion front, O'Reilly Automotive has opened 37 new stores in the United States and Mexico and entered the Canadian market through the acquisition of Vast Auto. The company's share repurchase program remains active, having bought back 0.3 million shares for a total investment of $270 million. These are some of the recent developments at O'Reilly Automotive.

InvestingPro Insights

Recent insider trading at O'Reilly Automotive Inc. (NASDAQ:ORLY) has caught the attention of market watchers. As stakeholders evaluate the implications of Director Gregory D. Johnson's stock sale, it's worth considering key financial metrics and expert analysis from InvestingPro. O'Reilly Automotive, with its significant presence in the auto parts industry, is currently trading at a high price-to-earnings (P/E) ratio of 28.16, which suggests that the stock might be valued at a premium relative to its near-term earnings growth potential.

InvestingPro Tips indicate that O'Reilly Automotive's stock could be in overbought territory, as evidenced by the Relative Strength Index (RSI). Additionally, the company is trading near its 52-week high, with the stock price at 96.95% of this peak. These factors could be relevant for investors considering the timing of Johnson's sale. For those looking for a deeper dive, InvestingPro offers 14 additional tips on O'Reilly Automotive, providing a more comprehensive analysis.

From a financial standpoint, the company's revenue growth over the last twelve months as of Q2 2024 stands at 6.99%, with a gross profit margin of 51.16%. This financial health is further underscored by the fact that O'Reilly Automotive has been profitable over the last twelve months, and its cash flows can sufficiently cover interest payments. Despite these positive indicators, it's important to note that short term obligations exceed liquid assets, which may warrant closer scrutiny from investors.

For those interested in the company's valuation metrics, O'Reilly Automotive operates with a moderate level of debt and exhibits low price volatility. Its market capitalization, as of the latest data, is $65.91 billion. To access a full suite of tips and in-depth financial analysis, interested parties can visit InvestingPro's dedicated page for O'Reilly Automotive at https://www.investing.com/pro/ORLY.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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