Stock Analysis on Net

O’Reilly Automotive Inc. (NASDAQ:ORLY)

$22.49

This company has been moved to the archive! The financial data has not been updated since November 8, 2022.

Return on Equity (ROE)
since 2005

Microsoft Excel

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Calculation

O’Reilly Automotive Inc., ROE, long-term trends, calculation

Microsoft Excel

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).

1 US$ in thousands


The financial data reveals several noteworthy trends over the analyzed periods, particularly in net income, shareholders’ equity, and return on equity (ROE).

Net Income
Net income demonstrates a consistent upward trajectory throughout the periods, increasing from approximately 164 million US dollars at the end of 2005 to over 2.16 billion US dollars by the end of 2021. This steady growth indicates a strong and sustained profitability trend, with notable acceleration after 2018.
Shareholders’ Equity
The shareholders’ equity figures present a more volatile trend. From 2005 through 2010, the equity increased steadily from roughly 1.15 billion to over 3.2 billion US dollars, indicating healthy growth in net assets. However, starting from 2011, there is a consistent decline, turning negative by the end of 2021 to around -66 thousand US dollars. This drop could reflect significant buybacks, dividend payments, or accumulated losses not offset by equity injections.
Return on Equity (ROE)
ROE shows a divergent pattern relative to the trends in equity. Beginning at 14.34% in 2005, it initially fluctuates but remains within a moderate range until 2010. Post-2010, ROE increases sharply, peaking at an exceptionally high level of 1249.34% by 2020, reflecting a severe distortion largely attributable to the diminishing equity base. The data for 2021 does not provide a ROE value, possibly due to negative equity, which invalidates the ratio.
Insights and Implications
The combination of rising net income and declining shareholders’ equity suggests that the company is generating strong earnings while reducing its equity base, which inflates ROE to levels that may not be sustainable or reflective of operational efficiency. The negative equity position at the end of the period is a significant concern, potentially indicating financial structure imbalances that may warrant deeper analysis into capital management strategies, debt levels, and return distributions.

Comparison to Competitors

O’Reilly Automotive Inc., ROE, long-term trends, comparison to competitors

Microsoft Excel

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).


Comparison to Sector (Consumer Discretionary Distribution & Retail)

O’Reilly Automotive Inc., ROE, long-term trends, comparison to sector (consumer discretionary distribution & retail)

Microsoft Excel

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).


Comparison to Industry (Consumer Discretionary)

O’Reilly Automotive Inc., ROE, long-term trends, comparison to industry (consumer discretionary)

Microsoft Excel

Based on: 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31), 10-K (reporting date: 2014-12-31), 10-K (reporting date: 2013-12-31), 10-K (reporting date: 2012-12-31), 10-K (reporting date: 2011-12-31), 10-K (reporting date: 2010-12-31), 10-K (reporting date: 2009-12-31), 10-K (reporting date: 2008-12-31), 10-K (reporting date: 2007-12-31), 10-K (reporting date: 2006-12-31), 10-K (reporting date: 2005-12-31).