O'reilly Automotive Stock Earnings Reports

O'Reilly reported a strong Q2 2026: consolidated comparable store sales grew 6% (7% YTD), driven by robust professional sales (≈10% comps) and low-single-digit DIY comps. Same-SKU inflation contributed ~5.5% to Q2 comps; management expects same-SKU benefit to moderate to ~1–2% in H2 as tariff-related price lapses are lapped. Gross margin was stable at 51.4% in Q2 and full-year gross margin guidance is maintained at 51.5%–52% (midpoint up ~16 bps vs. 2025). SG&A per store rose 4.8% in Q2 but full-year SG&A per-store growth is tightened to 3.5%–4%; operating profit guidance reiterated at 19.3%–19.8%. EPS guidance was raised to $3.20–$3.30 for 2026. Capital allocation priorities remain: (1) reinvest in stores and DCs / organic store openings (110 net YTD; targeting 225–235 net new stores in 2026), (2) selective tuck-in acquisitions (no expectation/intention of a large transformative deal), and (3) returning excess capital via buybacks. Free cash flow YTD was $1.5B (vs. $904M YTD 2025), and full-year FCF guide remains $1.8B–$2.1B. The company repurchased 34M shares year-to-date (~$3.1B) and is comfortable incrementally leveraging toward a targeted ~2.5x adjusted debt/EBITDAR (Q2 at 2.17x). Inventory per store was $892K (up 7% YoY); ending AP-to-inventory ~124% with an expected finish ~122%. Management is cautiously optimistic about H2 given weather and macro volatility (fuel prices, consumer pressure), but believes the underlying industry fundamentals (vehicle fleet size/age, miles driven) support continued demand and market-share opportunity.