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Stocks Continue to Fall Amid Anticipated Rate Hike

Stocks closed lower on Tuesday as the Fed and other central banks globally continued to show signs of an interest rate hike to tame inflation.

Overall, both S&P 500 and NASDAQ were down 1.1% to 3,986 and 11,883, respectively.

Meanwhile, O’Reilly Automative (ORLY) is like a machine. Earnings per share (EPS) have ballooned from $0.92 in 2003 to $31.10 in 2021. Looking ahead, analysts give the stock an Estimated Long-Term Growth Rate of 10% per year.

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Chart of the Day

Our chart of the day is the ten-year chart of ORLY.

ORLY is an automotive parts chain that was founded in 1957 from a single store in Missouri. As of December 2021, the company had a total of 5,759 domestic stores, 28 domestic distribution centers and 375 Hub stores.

ORLY is a well-oiled machine. The company builds new stores, buys back stock, and makes acquisitions, then goes into these old auto parts stores and makes them more efficient. Hopefully, the slow growth issue is short lived. One thing is for sure, the economy is hard on people right now as prices for gasoline, food, and housing are up around 8-10% from a year ago. It makes sense that people would repair their cars instead of buying new ones.

ORLY is part of the Growth Portfolio. ORLY has a P/E of 19, and David Sharek’s Fair Value is a P/E of 22.

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