Zacks_Analysts' Blog : O'Reilly Raises Repurchase Authorization - Analyst Blog

O'Reilly Automotive, Inc. (ORLY) recently announced that its board of directors authorized an additional $500 million for further repurchase of the company's common stock under its ongoing share repurchase program.

This new share repurchases sanction, effective November 16, 2011, has a time period of three years and brings the company’s total share repurchase authorization to $1.5 billion. Another similar announcement was made on August 5, 2011, when the Board raised the cumulative authorization under the share repurchase program to $1 billion.

At the end of the last reported quarter, O’Reilly generated cash and cash equivalents of $277 million, a significant increase from $43 million as of September 30, 2010. The improvement in cash balance reflects a bigger opportunity for the company to invest in stock repurchases from time to time.

During the first nine months of 2011, the company repurchased 14.1 million shares of its common stock at an average price of $59.69, for $840 million.

Again, subsequent to the end of the third quarter and until October 26, 2011, the company repurchased an additional 300,000 shares of its common stock at an average price of $65.81 for $19 million.

O'Reilly Automotive, a Zacks #1 Rank (short-term Strong Buy ) stock, is the third largest specialty retailer of automotive aftermarket parts, tools, supplies, equipment, and accessories in the U.S., selling products to both Do-it-Yourself (DIY) customers (53% of sales) and Do-it-for-Me (DIFM) or professional installers (47%).

The company sells an extensive line of products consisting of new and remanufactured automotive hard parts (such as mufflers, brakes, and shock absorbers), maintenance items, accessories, a complete range of auto body paint and related materials, automotive tools and professional service equipment.