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Uh, President Trump of course planning to impose 25% tariffs on imported vehicles and consumers, investors, business people, David, all all try to figure out the ripple effects of that. You argue it could be though a positive for the auto parts makers. How come, David? Walk us through that.

Exactly. Thanks for having back on, Josh. And tariffs have been a good thing for auto parts in general. Prices go up, you got a lot of pricing power here, eventually gets passed on to the consumer. But if you have these new vehicle tariffs coming to play, that should in effect push more used vehicle sales in the process. And it'll it'll basically allow consumers to hold on to their cars longer. So that this has been a dynamic in the US for many, many years now. The average age of the car on the road in the US is almost 13 years old. So you've got cars that are lasting longer, you could drive them for a couple hundred thousand miles instead of just 100,000 miles if you think back a decade ago. But people want to keep investing in these used car price has gone way up, you know, 30% higher than 2019 levels. So you see that as an investment. And then the more and more that that average age of vehicle on the road goes up, as you get more and more used car sales versus new, that should help all these guys advance, uh, AutoZone, O'Reilly and just the need for parts continues to grow.

And how expensive though, David, is that going to get for folks there to repair their their cars they already own, already own because doesn't the price of the parts also go up?

That that's exactly right, but it's a lesser increase than if you're buying a new car. So if you could shell out a few hundred bucks to keep your car on the road versus going out and buying a new car, we we've heard some of these monthly payments for new cars could be seven, 800, $900 a month, then that's not for anything special. We're not talking about a Maserati here. You're talking about a Honda Civic, right? Just with their interest rates have gone and used car prices have gone. So it's it's almost unaffordable for a decent set of consumers. But from that relative value perspective, if you could throw a few hundred bucks into your older Ford F-150 to keep it on the road, keep you getting to work, bring your kids to school, you'll make that trade any day.

Let's get to some picks here, David, to play this thing. One I know you like, I think it's your top pick, O'Reilly. That one I'm just looking here, it's already up about 20% so far this year, but you say it's still a buy here at these levels.

Yeah, that's right. We've got an upside target of about 1700 bucks on O'Reilly shares and this is a great secular growth story. They they still have room to grow stores in the US. They're also going international, opening some stores in in Mexico here. But the the demand dynamics of this business are simply incredible, right? You've got a lot of cars on the road, almost 300 million cars in the US, miles driven are up, there's a lot of jobs out there. So people are out and driving that leads to repairs. It's it's just a very, very steady business model. They deliver parts to their uh, more commercial operators, right? So you think about their business leans more towards professional parts people versus the do it yourself customers. That's where a lot of the growth is on that pro side. They can deliver a part to those customers in under 30 minutes. So it's it's really difficult model to replicate. Plus you've got O'Reilly buying back a lot of their own equity. They're going to do a stock split here soon, and I I think that'll even allow them to buy back shares better than they have just with more volume out there. So a good name and still one of our top picks here.

And off the same thing we're talking about, David, is AutoZone, which is also had a nice run already in 2025, but you say stick with it, it's a buy.

Yeah, very similar story here. AutoZone leans more to that do it yourself customer. It's about 70, 75% of the business in the US, but they made all these investments to grow that commercial side. They they've got a relatively new CEO in place. He's the AutoZone veteran been there for years, but he's coming in and also adding that international story here. But these investments on the commercial side have really hit scale, and that that business should accelerate through the balance of the year, and that the tariffs certainly will help.

Final one I want to squeeze in here, uh, CarMax. Now that one, stocks in the red this year and over the last 12 months, but you've been telling your clients it's a buy.

We've got a neutral rating on CarMax.

I apologize, a neutral on that one, did.

No problem at all. It's the same store sales that the unit sales growth for CarMax has been a little lumpy because those prices have been so high, right? It's it's been a bit of a detriment to that customer base that's under a little more pressure. But if you have new tariffs on these new cars coming in, that could shift a lot of volumes into the used space. So this is a developing positive for CarMax within the context of our neutral rating here. But if if you see some of this share shift from new to used, it's a big positive for them and the the used car space is huge. You're you're talking almost 40 million unit sales a year. New is about 15 million, but any any shifts in those percentages, you're talking about hundreds of thousands of vehicle volumes that could be up for grabs for someone like CarMax or or their peer Carvana that's out there and does more of the e-commerce aspect of that space. But probably a good thing for both of those guys if you do get these 25% tariffs coming in on the new the new cars.

David, thank you so much for your time today and those stock picks. Appreciate it.