Brad Beckham
O REILLY AUTOMOTIVEAbout Brad Beckham
Brad Beckham is Chief Executive Officer of O’Reilly Automotive (ORLY), promoted effective February 1, 2024, after serving as Co-President in 2023 and previously as Executive Vice President & Chief Operating Officer; he has been with O’Reilly since 1996, progressing from Parts Specialist through store and regional leadership into executive roles . In 2024, O’Reilly delivered 2.9% comparable store sales growth, $40.66 diluted EPS, and $3.05B cash from operations, and cites a 5-year total shareholder return of 171%, marking its 32nd consecutive year of positive comps . The company noted the trading price was $1,331.06 on March 6, 2025, alongside sustained capital returns via buybacks and expansion into Canada via Groupe Del Vasto .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| O’Reilly Automotive | Parts Specialist → Store Manager → District Manager → Regional Manager | 1996–2010s | Built ground-up operating experience in store execution and market-level sales . |
| O’Reilly Automotive | Divisional VP; VP/SVP Eastern & Central Store Operations & Sales | 2010s–2018 | Drove multi-region sales, staffing, and operational consistency . |
| O’Reilly Automotive | EVP Store Operations & Sales | 2018–2021 | Led nationwide store ops and sales programs . |
| O’Reilly Automotive | EVP & Chief Operating Officer | Jan 2022–Jan 2023 | Oversaw enterprise operations; prepared for succession . |
| O’Reilly Automotive | Co-President | Jan 2023–Jan 2024 | Co-led operations and supply chain; transition preparatory step . |
| O’Reilly Automotive | Chief Executive Officer | Feb 2024–present | CEO with board-aligned strategy on growth, capital allocation . |
External Roles
No external public-company directorships or disclosed outside executive roles for Beckham were identified; disclosures emphasize an internally developed leadership pipeline .
Fixed Compensation
Multi-year total compensation (as reported):
| Metric ($) | 2022 | 2023 | 2024 |
|---|---|---|---|
| Salary | 600,000 | 744,231 | 971,154 |
| Bonus | — | — | — |
| Stock Awards (RS/RSU) | — | — | — |
| Option Awards (grant-date FV) | 1,599,991 | 750,154 | 1,250,586 |
| Non-Equity Incentive (annual cash) | 859,116 | 1,329,271 | 500,000 |
| All Other Compensation | 49,303 | 34,822 | 89,323 |
| Total | 3,108,410 | 2,858,478 | 2,811,063 |
2024 salary increase reflected promotion to CEO; 2024 CEO pay ratio was 89:1 (CEO $2,829,492 vs. median employee $31,854) . Detailed 2024 perquisites for Beckham included deferred comp plan contributions ($39,900), 401(k) ($10,350), medical reimbursements ($11,500), group life insurance ($810), ESPP discount ($8,399), personal automobile ($7,350), relocation ($10,708), and club dues ($306) .
Performance Compensation
Annual incentive design and 2024 outcomes:
| Metric | Weight (%) | Threshold | Target | Actual | Achievement (%) |
|---|---|---|---|---|---|
| Comparable store sales | 30 | 2.5% | 4.0% | 2.9% | 11.0 |
| Operating income ($000) | 30 | 3,271,000 | 3,371,000 | 3,251,157 | — (below threshold) |
| Return on invested capital | 20 | 62.02% | 67.29% | 66.93% | 19.0 |
| Free cash flow ($000) | 20 | 1,693,000 | 1,993,000 | 1,987,808 | 20.0 |
| Total | 100 | — | — | — | 50.0 |
Resulting payouts for 2024:
| Executive | Base Salary ($) | Target (% of Salary) | Target ($) | Achievement (%) | Incentive Achieved ($) |
|---|---|---|---|---|---|
| Brad Beckham (CEO) | 1,000,000 | 100% | 1,000,000 | 50.0 | 500,000 |
Long-term equity (options) granted Feb 1, 2024:
| Grant Date | Securities Underlying Options (#) | Exercise Price ($/sh) | Grant-Date Fair Value ($) | Vesting | Expiration |
|---|---|---|---|---|---|
| 2/1/2024 | 2,980 | 1,041.75 | 1,250,586 | 25% per year 2025–2028 | 2/1/2034 |
Say-on-pay support exceeded 90% in 2024, and O’Reilly has not received less than 85% since 2011, indicating sustained shareholder alignment with pay design .
Equity Ownership & Alignment
- Beneficial ownership (as of March 6, 2025): Direct 763 shares, Indirect 1,085 shares, Current exercisable options 14,255; Total 16,103 shares (<1% of class) . With 57,240,513 shares outstanding as of March 6, 2025, Beckham’s beneficial ownership is approximately 0.028% (calculated from cited figures) .
- Outstanding options (as of December 31, 2024) include multiple grants; unexercisable options total 8,664 across 2021–2024 grants (418 + 2,153 + 1,332 + 1,781 + 2,980) .
- 2024 exercises: Beckham exercised 6,032 options, realizing $4,872,515, indicative of periodic liquidity events around vesting cycles .
- Stock ownership guidelines: CEO must hold 5x base salary; eligible equity includes beneficially owned shares but excludes unvested awards; 5-year compliance period; non-compliant executives must retain 50% of net after-tax shares until compliant; all directors and executive officers were in compliance as of December 31, 2024 .
- Hedging/pledging: Prohibited for directors and NEOs, including margin accounts; policy enforces alignment and reduces forced-sale risk .
Employment Terms
Change-in-control (CIC) framework:
- Double-trigger severance: If terminated without cause, for good reason, death or disability within six months prior to or two years after a CIC, NEOs receive 2x salary and 2x target bonus, 2 years benefits continuation, prior year unpaid bonus plus pro-rata target bonus, unused PTO, up to $30,000 outplacement, and legal fee coverage; equity awards vest immediately and options become immediately exercisable for 12 months .
- Illustrative CIC amounts (termination immediately following CIC on Dec 31, 2024): Beckham’s total would be $7,233,272, including $2,000,000 salary continuation, $2,000,000 incentive compensation, $61,279 benefits, $4,505 unused PTO, and $3,167,488 unvested option value .
- Equity acceleration: Under incentive plans, unvested options and restricted shares vest upon CIC irrespective of termination (single-trigger equity vesting) . Clawback policy:
- “No-fault” mandatory recovery for current/former Section 16 officers upon accounting restatements per SEC/Nasdaq rules; additional discretionary recovery for fraud/willful misconduct (3-year lookback) on “Additional Compensation” including time-vesting equity .
Performance & Track Record
- 2024 operational highlights: 2.9% comps, operating profit dollars $3.25B, diluted EPS $40.66, capex $1.02B, $2.08B share repurchases; international expansion via Groupe Del Vasto acquisition (23 stores), total store count 6,378, 32 distribution centers; 5-year TSR 171% .
- Pay-versus-performance data shows compensation actually paid tracks operating income and net income over time (Company identifies operating income as the most important measure) .
- 2025 proxy notes a planned 15-for-1 stock split to improve accessibility, with post-split trading expected June 10, 2025, and appropriate anti-dilution adjustments to equity plans .
Compensation Governance & Peer Group
- Peer group changes for 2024: Removals (Big Lots, Darden Restaurants, Foot Locker); Additions (BJ’s Wholesale Club, Fastenal, Ulta Beauty). Full 2024 peer group includes AAP, AN, AZO, BJ, DKS, DG, DLTR, FAST, GPC, LKQ, LOW, ROST, SHW, TSCO, ULTA, GWW; peer group revenue and market cap ranges contextualize ORLY’s scale ($16.71B revenue; $68.16B market cap) .
- Equity plans: As of year-end 2024, 628k options outstanding with $548.91 weighted-average exercise price; 5,402k shares available for future issuance under shareholder-approved plans .
- Governance practices include clawback enforcement, prohibition on hedging/pledging, majority vote standards, proxy access, and separation of CEO and Chairman roles .
Additional Financial Context
| Metric | FY 2023 | FY 2024 |
|---|---|---|
| Revenue ($USD) | 15,812,250,000 | 16,708,479,000 |
| EBITDA ($USD) | 3,597,637,000* | 3,713,549,000* |
*Values retrieved from S&P Global.
Investment Implications
- Alignment: CEO pay emphasizes equity with multi-year option vesting and strict ownership/retention rules; hedging/pledging bans and robust clawback reduce misalignment risk .
- Incentive quality: 2024 cash incentive paid at 50% of target due to operating income shortfall despite strong ROIC and near-target FCF, suggesting balanced metrics and payout discipline amid a challenging backdrop .
- Retention and liquidity signals: Ongoing vesting plus demonstrated option exercises (6,032 exercised; $4.87M realized) imply predictable windows of potential insider selling to manage liquidity, but policy guardrails limit hedging/pledging risks and require sustained ownership .
- Change-in-control economics: Double-trigger severance at 2x salary and target bonus, with single-trigger equity acceleration upon CIC, provides competitive protection; investors should be mindful of accelerated vesting impact in M&A scenarios .
- Execution track record: Continued positive comps, strong TSR, disciplined capital allocation (buybacks and capex), and expansion into Canada illustrate sustained value creation; governance and say-on-pay support (>90%) reinforce investor confidence .