Here's What Boosted O'Reilly Automotive's (ORLY) Performance in Q1

Parnassus Investments, an investment management company, released the “Parnassus Mid Cap Growth Fund” first quarter 2025 investor letter. A copy of the letter can be downloaded here. The Russell Midcap Growth Index fell 7.12% in the first quarter, starting with a continuation of the late 2024 rally but later experiencing a sharp decline. The Fund (Investor Shares) fell -9.98% (net of fees) in the quarter, compared to the Russell Midcap Growth Index’s -7.12% fall. Stock selection in Consumer Discretionary and Industrials contributed to the relative performance, while Communication Services and Health Care detracted. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its first-quarter 2025 investor letter, Parnassus Mid Cap Growth Fund highlighted stocks such as O’Reilly Automotive, Inc. (NASDAQ:ORLY). O’Reilly Automotive, Inc. (NASDAQ:ORLY) is a retailer and supplier of automotive aftermarket parts, tools, supplies, equipment, and accessories. The one-month return of O’Reilly Automotive, Inc. (NASDAQ:ORLY) was -0.14%, and its shares gained 34.24% of their value over the last 52 weeks. On July 3, 2025, O’Reilly Automotive, Inc. (NASDAQ:ORLY) stock closed at $91.33 per share, with a market capitalization of $78.07 billion.

Parnassus Mid Cap Growth Fund stated the following regarding O’Reilly Automotive, Inc. (NASDAQ:ORLY) in its Q1 2025 investor letter:

O’Reilly Automotive, Inc. (NASDAQ:ORLY), an aftermarket auto parts retailer, helped performance as the company posted steady results and benefited from its exposure to nondiscretionary consumer spending. Its scale, execution, and countercyclical demand profile continue to support our conviction.

O’Reilly Automotive, Inc. (NASDAQ:ORLY) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 58 hedge fund portfolios held O’Reilly Automotive, Inc. (NASDAQ:ORLY) at the end of the first quarter, which was 63 in the previous quarter. While we acknowledge the potential of O’Reilly Automotive, Inc. (NASDAQ:ORLY) as an investment, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is as promising as NVIDIA but that trades at less than 5 times its earnings, check out our report about the undervalued AI stock set for massive gains.

In another article, we covered O’Reilly Automotive, Inc. (NASDAQ:ORLY) and shared Qualivian Investment Partners' views on the company. In addition, please check out our hedge fund investor letters Q1 2025 page for more investor letters from hedge funds and other leading investors. While we acknowledge the potential of ORLY as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you’re looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.