2012 has been a good year for shareholders of O'Reilly Automotive (ORLY - Get Report). Shares of the auto parts retailer have rallied close to 16% since the first trading day of January, outpacing even the S&P's prodigious rally this year. O'Reilly is the second-largest auto parts chain in the country, with more than 3,700 stores spread across the country. The firm's unique positioning sets it apart from peers right now.
O'Reilly started off serving the commercial auto parts market, a lucrative business that rival retailers are actively trying to acquire right now. By starting off in that business, ORLY is able to boast a bigger chunk of sales from the commercial segment. While the acquisition of CSK Auto shifted O'Reilly's sales mix more to the retail side, management has been aggressively working to make CSK's business mirror the operations at legacy O'Reilly stores.From a secular perspective, there are some major tailwinds lapping at auto stores' backs. The biggest is the average age of the U.S. car fleet -- while new auto sales have been strong lately, the average age of cars on the road has been drawing longer. That makes a strong case for increased car part demand, and it's helped to drive the nearly double-digit net margins that ORLY has seen in the last year or two. Investors should watch out for first-quarter earnings on April 26. O'Reilly shows up on a recent list of the 10 Longest-Held Stocks of Top-Rated Mutual Funds. Follow @stockpickr