The Relative Strength (RS) Rating for O'Reilly Automotive jumped Tuesday, as it got a lift from 70 to 76. The bump higher came after the company's earning per share growth rate edged up every quarter over the past year. O'Reilly stock rose Wednesday afternoon.
That slow, steady rise in earnings also gives Springfield, Mo.-based O'Reilly a near-best 96 Earnings Per Share Rating out of 99.
The upgraded 76 Relative Strength Rating means O'Reilly stock is in the top quartile of all stocks for price performance this past year. Sales have grown at a low double-digit rate the past year too.
Market research shows that the best stocks typically have an RS Rating north of 80 in the early stages of their moves. See if O'Reilly Automotive can continue to show renewed price strength and clear that threshold.
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O'Reilly Stock Fundamentals Strong
Among its other key ratings O'Reilly Automotive boasts an A SMR Rating (sales + profit margins + return on equity) on an A-to-E scale with A terrific and E miserable. The A rating reflects strong fundamentals.
Additionally, O'Reilly stock has an 87 Composite Rating, a mix of five other fundamental and technical metrics. The 87 rating puts it in the top 13% of all stocks overall. It's a good rating although the best stocks often have a 90 or better Composite.
O'Reilly stock has risen steadily for many years. For example, it traded at about 968 Tuesday afternoon, nearly four times higher than its late March 2020 Covid crash low 251.52. However, it's moved sideways in a fairly narrow range since May.
ORLY stock broke out last month, but it has fallen back below the 975.72 entry from a flat base. It was up fractionally Tuesday, nearing the buy point again.
Breakout Prospects Good But Keep This In Mind
One thing to note is that the most recent pattern is a later-stage base. Such bases can succeed but are more prone to failure than early (first and second) stage bases. Also, O'Reilly stock has a D+ Accumulation/Distribution Rating, which means institutional investors like ETFs and mutual fund are currently selling more shares than buying.
On the upside, it trades above both its 50-day and 200-day lines, a bullish indicator.
O'Reilly Automotive showed 17% earnings growth in the latest quarterly report, to $10.72 per share. The prior three periods its EPS grew 10%, 15% and then 16%. Sales grew 11% last quarter to $4.2 billion.
O'Reilly stock holds the No. 2 rank among its peers in the Retail/Wholesale-Auto industry group. Salvage vehicle auction specialist Copart is No. 1 and auto lubricants maker Valvoline is No. 3 among the group's highest-rated stocks.
When looking for the best stocks to buy and watch, the RS Rating showcases stocks that are rising at a faster rate than all others.
IBD's Relative Strength Rating measures technical performance by using a 1 (worst) to 99 (best) score that indicates how a stock's price performance over the last 52 weeks stacks up against all the other stocks.
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