Stock Analysis on Net
Stock Analysis on Net

O’Reilly Automotive Inc. (NASDAQ:ORLY)

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

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

O’Reilly Automotive Inc., income tax expense (benefit), continuing operations

US$ in thousands

Microsoft Excel
12 months ended: Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Federal income tax expense 485,988 401,331 315,061 289,953 467,577
State income tax expense 104,837 97,085 62,795 59,487 41,183
International income tax expense 6,021 3,306 273 — —
Current 596,846 501,722 378,129 349,440 508,760
Federal income tax expense (benefit) 20,543 16,749 19,367 16,309 (13,053)
State income tax expense (benefit) 2,432 (2,865) 2,027 3,851 8,293
International income tax benefit (2,592) (1,503) (236) — —
Deferred 20,383 12,381 21,158 20,160 (4,760)
Net income tax expense 617,229 514,103 399,287 369,600 504,000

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).

Item Description The company
Current Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. O’Reilly Automotive Inc. current increased from 2019 to 2020 and from 2020 to 2021.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. O’Reilly Automotive Inc. deferred decreased from 2019 to 2020 but then increased from 2020 to 2021 not reaching 2019 level.
Net income tax expense Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. O’Reilly Automotive Inc. net income tax expense increased from 2019 to 2020 and from 2020 to 2021.

Effective Income Tax Rate (EITR)

O’Reilly Automotive Inc., effective income tax rate (EITR) reconciliation

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Federal statutory tax rate 21.00% 21.00% 21.00% 21.00% 35.00%
Effective income tax rate 22.19% 22.68% 22.30% 21.82% 30.77%

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).

Item Description The company
Effective income tax rate Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. O’Reilly Automotive Inc. effective income tax rate increased from 2019 to 2020 but then decreased significantly from 2020 to 2021.

Components of Deferred Tax Assets and Liabilities

O’Reilly Automotive Inc., components of deferred tax assets and liabilities

US$ in thousands

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Allowance for doubtful accounts 1,538 1,574 2,008 1,944 1,885
Tax credits 284 1,444 3,417 5,606 7,179
Other accruals 142,714 143,387 97,189 105,894 97,247
Operating lease liability 513,492 513,134 494,093 — —
Net operating losses — — — — 346
Other 16,117 16,594 15,732 14,770 14,784
Deferred tax assets 674,145 676,133 612,439 128,214 121,441
Inventories (64,562) (79,326) (65,346) (62,846) (55,965)
Property and equipment (212,649) (194,000) (162,613) (140,019) (122,354)
Operating lease asset (496,996) (498,042) (479,821) — —
Other (75,150) (60,664) (37,939) (30,915) (28,528)
Deferred tax liabilities (849,357) (832,032) (745,719) (233,780) (206,847)
Net deferred tax assets (liabilities) (175,212) (155,899) (133,280) (105,566) (85,406)

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).

Item Description The company
Deferred tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. O’Reilly Automotive Inc. deferred tax assets increased from 2019 to 2020 but then slightly decreased from 2020 to 2021.
Net deferred tax assets (liabilities) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. O’Reilly Automotive Inc. net deferred tax assets (liabilities) decreased from 2019 to 2020 and from 2020 to 2021.

Deferred Tax Assets and Liabilities, Classification

O’Reilly Automotive Inc., deferred tax assets and liabilities, classification

US$ in thousands

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Deferred tax liabilities 175,212 155,899 133,280 105,566 85,406

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).

Item Description The company
Deferred tax liabilities Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. O’Reilly Automotive Inc. deferred tax liabilities increased from 2019 to 2020 and from 2020 to 2021.

Adjustments to Financial Statements: Removal of Deferred Taxes

O’Reilly Automotive Inc., adjustments to financial statements

US$ in thousands

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Adjustment to Total Liabilities
Total liabilities (as reported) 11,785,130 11,456,384 10,319,820 7,627,122 6,918,839
Less: Noncurrent deferred tax liabilities, net 175,212 155,899 133,280 105,566 85,406
Total liabilities (adjusted) 11,609,918 11,300,485 10,186,540 7,521,556 6,833,433
Adjustment to Shareholders’ Equity (deficit)
Shareholders’ equity (deficit) (as reported) (66,423) 140,258 397,340 353,667 653,046
Less: Net deferred tax assets (liabilities) (175,212) (155,899) (133,280) (105,566) (85,406)
Shareholders’ equity (deficit) (adjusted) 108,789 296,157 530,620 459,233 738,452
Adjustment to Net Income
Net income (as reported) 2,164,685 1,752,302 1,391,042 1,324,487 1,133,804
Add: Deferred income tax expense (benefit) 20,383 12,381 21,158 20,160 (4,760)
Net income (adjusted) 2,185,068 1,764,683 1,412,200 1,344,647 1,129,044

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).

O’Reilly Automotive Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

O’Reilly Automotive Inc., adjusted financial ratios

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
Net Profit Margin
Reported net profit margin 16.24% 15.10% 13.70% 13.89% 12.63%
Adjusted net profit margin 16.40% 15.21% 13.91% 14.10% 12.58%
Financial Leverage
Reported financial leverage — 82.68 26.97 22.57 11.59
Adjusted financial leverage 107.72 39.16 20.20 17.38 10.25
Return on Equity (ROE)
Reported ROE — 1,249.34% 350.09% 374.50% 173.62%
Adjusted ROE 2,008.54% 595.86% 266.14% 292.80% 152.89%
Return on Assets (ROA)
Reported ROA 18.47% 15.11% 12.98% 16.60% 14.97%
Adjusted ROA 18.65% 15.22% 13.18% 16.85% 14.91%

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).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. O’Reilly Automotive Inc. adjusted net profit margin ratio improved from 2019 to 2020 and from 2020 to 2021.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 O’Reilly Automotive Inc. adjusted financial leverage ratio increased from 2019 to 2020 and from 2020 to 2021.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. O’Reilly Automotive Inc. adjusted ROE improved from 2019 to 2020 and from 2020 to 2021.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. O’Reilly Automotive Inc. adjusted ROA improved from 2019 to 2020 and from 2020 to 2021.

O’Reilly Automotive Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net income 2,164,685 1,752,302 1,391,042 1,324,487 1,133,804
Sales 13,327,563 11,604,493 10,149,985 9,536,428 8,977,726
Profitability Ratio
Net profit margin1 16.24% 15.10% 13.70% 13.89% 12.63%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income 2,185,068 1,764,683 1,412,200 1,344,647 1,129,044
Sales 13,327,563 11,604,493 10,149,985 9,536,428 8,977,726
Profitability Ratio
Adjusted net profit margin2 16.40% 15.21% 13.91% 14.10% 12.58%

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).

2021 Calculations

1 Net profit margin = 100 × Net income ÷ Sales
= 100 × 2,164,685 ÷ 13,327,563 = 16.24%

2 Adjusted net profit margin = 100 × Adjusted net income ÷ Sales
= 100 × 2,185,068 ÷ 13,327,563 = 16.40%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. O’Reilly Automotive Inc. adjusted net profit margin ratio improved from 2019 to 2020 and from 2020 to 2021.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in thousands)
Total assets 11,718,707 11,596,642 10,717,160 7,980,789 7,571,885
Shareholders’ equity (deficit) (66,423) 140,258 397,340 353,667 653,046
Solvency Ratio
Financial leverage1 — 82.68 26.97 22.57 11.59
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Total assets 11,718,707 11,596,642 10,717,160 7,980,789 7,571,885
Adjusted shareholders’ equity (deficit) 108,789 296,157 530,620 459,233 738,452
Solvency Ratio
Adjusted financial leverage2 107.72 39.16 20.20 17.38 10.25

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).

2021 Calculations

1 Financial leverage = Total assets ÷ Shareholders’ equity (deficit)
= 11,718,707 ÷ -66,423 = —

2 Adjusted financial leverage = Total assets ÷ Adjusted shareholders’ equity (deficit)
= 11,718,707 ÷ 108,789 = 107.72

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 O’Reilly Automotive Inc. adjusted financial leverage ratio increased from 2019 to 2020 and from 2020 to 2021.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net income 2,164,685 1,752,302 1,391,042 1,324,487 1,133,804
Shareholders’ equity (deficit) (66,423) 140,258 397,340 353,667 653,046
Profitability Ratio
ROE1 — 1,249.34% 350.09% 374.50% 173.62%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income 2,185,068 1,764,683 1,412,200 1,344,647 1,129,044
Adjusted shareholders’ equity (deficit) 108,789 296,157 530,620 459,233 738,452
Profitability Ratio
Adjusted ROE2 2,008.54% 595.86% 266.14% 292.80% 152.89%

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).

2021 Calculations

1 ROE = 100 × Net income ÷ Shareholders’ equity (deficit)
= 100 × 2,164,685 ÷ -66,423 = —

2 Adjusted ROE = 100 × Adjusted net income ÷ Adjusted shareholders’ equity (deficit)
= 100 × 2,185,068 ÷ 108,789 = 2,008.54%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. O’Reilly Automotive Inc. adjusted ROE improved from 2019 to 2020 and from 2020 to 2021.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2021 Dec 31, 2020 Dec 31, 2019 Dec 31, 2018 Dec 31, 2017
As Reported
Selected Financial Data (US$ in thousands)
Net income 2,164,685 1,752,302 1,391,042 1,324,487 1,133,804
Total assets 11,718,707 11,596,642 10,717,160 7,980,789 7,571,885
Profitability Ratio
ROA1 18.47% 15.11% 12.98% 16.60% 14.97%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income 2,185,068 1,764,683 1,412,200 1,344,647 1,129,044
Total assets 11,718,707 11,596,642 10,717,160 7,980,789 7,571,885
Profitability Ratio
Adjusted ROA2 18.65% 15.22% 13.18% 16.85% 14.91%

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).

2021 Calculations

1 ROA = 100 × Net income ÷ Total assets
= 100 × 2,164,685 ÷ 11,718,707 = 18.47%

2 Adjusted ROA = 100 × Adjusted net income ÷ Total assets
= 100 × 2,185,068 ÷ 11,718,707 = 18.65%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. O’Reilly Automotive Inc. adjusted ROA improved from 2019 to 2020 and from 2020 to 2021.