ORLY vs AZO

For growth investors, O'Reilly Automotive, Inc.

(ORLY) is the stronger pick with 6. 4% revenue growth year-over-year, versus 2. 4% for AutoZone, Inc. (AZO). AutoZone, Inc. (AZO) offers the better valuation at 24. 4x trailing P/E (23. 8x forward), making it the more compelling value choice. Analysts rate O'Reilly Automotive, Inc. (ORLY) a "Buy" — based on 47 analyst ratings — the highest consensus in this comparison. The "better buy" depends entirely on your goals: growth investors should weight revenue trajectory, value investors should weight P/E and PEG, and income investors should weight dividend yield and streak.

On trailing P/E, AutoZone, Inc.

(AZO) is the cheapest at 24. 4x versus O'Reilly Automotive, Inc. at 31. 9x. On forward P/E, AutoZone, Inc. is actually cheaper at 23. 8x. The PEG ratio (P/E divided by earnings growth rate) is the most growth-adjusted single valuation metric: AutoZone, Inc. wins at 1. 58x versus O'Reilly Automotive, Inc. 's 2. 34x — a reasonable growth-adjusted valuation.

Over the past 5 years, O'Reilly Automotive, Inc.

(ORLY) delivered a total return of +153. 4%, compared to +137. 9% for AutoZone, Inc. (AZO). Over 10 years, the gap is even starker: ORLY returned +434. 6% versus AZO's +356. 3%. Past returns do not guarantee future results, and the stock with the higher historical return may already have its best growth priced in.

By beta (market sensitivity over 5 years), O'Reilly Automotive, Inc.

(ORLY) is the lower-risk stock at 0. 14β versus AutoZone, Inc. 's 0. 22β — meaning AZO is approximately 52% more volatile than ORLY relative to the S&P 500.

By revenue growth (latest reported year), O'Reilly Automotive, Inc.

(ORLY) is pulling ahead at 6. 4% versus 2. 4% for AutoZone, Inc. (AZO). On earnings-per-share growth, the picture is similar: O'Reilly Automotive, Inc. grew EPS 9. 6% year-over-year, compared to -3. 1% for AutoZone, Inc.. Over a 3-year CAGR, ORLY leads at 7. 3% annualised revenue growth. Higher growth typically commands a higher valuation multiple — check whether the premium P/E or P/S is justified by the growth rate using the PEG ratio.

O'Reilly Automotive, Inc.

(ORLY) is the more profitable company, earning 14. 3% net margin versus 13. 2% for AutoZone, Inc. — meaning it keeps 14. 3% of every revenue dollar as bottom-line profit. Operating margin tells a similar story: ORLY leads at 19. 5% versus 19. 1% for AZO. At the gross margin level — before operating expenses — AZO leads at 52. 6%, reflecting greater pricing power or product mix advantage. Stronger margins indicate durable pricing power, lower cost of revenue, or higher mix of software/services. They are one of the clearest signs of business quality.

The PEG ratio (forward P/E divided by expected earnings growth rate) is the most precise measure of undervaluation relative to growth potential.

By this metric, AutoZone, Inc. (AZO) is the more undervalued stock at a PEG of 1. 58x versus O'Reilly Automotive, Inc. 's 2. 34x. Both stocks trade at elevated growth-adjusted valuations, so expected growth needs to materialise. On forward earnings alone, AutoZone, Inc. (AZO) trades at 23. 8x forward P/E versus 29. 2x for O'Reilly Automotive, Inc. — 5. 4x cheaper on a one-year earnings basis. Analyst consensus price targets imply the most upside for AZO: 19. 6% to $4235. 71.

None of the stocks in this comparison currently pay a material dividend.

All are effectively zero-yield and should be held for capital appreciation rather than income.

For long-horizon retirement investors, O'Reilly Automotive, Inc.

(ORLY) is the stronger choice — it scores higher on the combination of lower volatility, dividend reliability, and long-term compounding (low volatility (β 0. 14), +434. 6% 10Y return). Both have compounded well over 10 years (ORLY: +434. 6%, AZO: +356. 3%), confirming both are viable long-term holds — but the lower-volatility option typically results in less emotional selling during corrections. Retirement portfolios generally favour predictability over maximum returns. Consult a financial advisor before making allocation decisions.

Both stocks operate in the Consumer Cyclical sector, making this a peer-level intra-sector comparison — the same macro tailwinds and headwinds will affect both.

These fundamental differences mean investors should not choose between them on a single metric — the "better stock" depends entirely on which of these characteristics aligns with your investment strategy.