O’Reilly Automotive Inc. on Wednesday said its profit rose in the first quarter on higher sales and better margins, continuing a trend of 15% or greater profit growth for the past six years.
The Springfield, Mo., auto-parts retailer, which recently has been building its distribution network and expanding its store footprint, had projected improved results driven by lower gas prices and wear and tear of older vehicles, particularly those out of warranty, as customers have opted for spending more to repair cars rather than buy new ones. In 2015, O’Reilly plans to add a net 205 stores, compared with 200 stores in 2014. In the latest period, it opened 67 stores.
On Wednesday, the company raised its projection for the year to earnings between $8.42 and $8.52 a share, from $8.20 to $8.30 a share, on $7.6 billion to $7.8 billion in revenue. Analysts project $8.55 a share on $7.74 billion in revenue.
Shares rose 4% in recent after-hours trading to $225.50, topping the 52-week-high of $222.94 set on April 9 during regular trading.
For the current quarter, O’Reilly projects a profit of $2.17 to $2.21 a share, compared with the $2.25 a share view of analysts surveyed by Thomson Reuters. Sales at stores open for at least a year are projected to increase 3% to 5%.
Overall, for the first three months of the year, O’Reilly reported a profit of $212.9 million, or $2.06 a share, up from $173.9 million, or $1.61 a share, a year earlier.
The company had projected $1.89 to $1.93 a share.
Revenue rose 10% to $1.9 billion, topping the consensus of $1.86 billion.
Sales at established stores rose 7.2% from the year-ago period, topping the company’s projection of 3% to 5% growth.
Gross margin improved to 51.9% from 50.8% a year earlier.
Through Wednesday’s close, the company’s stock was up 46% over the past 12 months.