Comparable-store sales growth is the mantra of all retailers. But when the top line hits a speed bump, it gets tougher to bring home the bottom line.
Reviewing the last four quarters, O'Reilly Automotive
% Change |
Q1 |
Q2 |
Q3 |
Q4 |
---|---|---|---|---|
Comp Sales |
6.8% |
2.0% |
4.3% |
2.1% |
EPS* |
18.3% |
4.4% |
9.6% |
0.0% |
Earnings growth skidded to a halt despite the fourth quarter's 2.1% increase in same-store sales and 8.2% rise in sales. The culprit?
My first guess would have been that O'Reilly was the victim of one-time costs relating to its on-again, off-again attempts to acquire CSK Auto
O'Reilly has been coasting for some time now, as customers are scaling back discretionary spending. While AutoZone
To me, O'Reilly has the best long-term growth prospects in the sector, it just needs to tighten its belt a bit on the expense side. If the company can remain disciplined in its spending habits, O'Reilly should be positioned to thrive when the economy finally ignites its growth engine again.
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AutoZone sees opportunity.
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To me, O'Reilly seems the obvious choice.
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