A global chip shortage has put the squeeze on car production and driven the price of used cars higher.
Used car and truck prices rose by more than 45% in June, according to the most recent read on inflation.
That looks to have had a knock-on effect among auto stocks with repair and tune-up plays gaining favor among investors. Advanced Auto Parts, AutoZone, AutoNation and O'Reilly Automotive hit record highs in the past week.
Raymond James also weighed in on the group on Tuesday. Analysts upgraded Advance Auto Parts to a strong buy, saying its turnaround story is paying off, while downgrading AutoZone to a still bullish outperform rating.
The firm also said O'Reilly should continue to take market share thanks to its "leading supply chain capabilities" and robust cash flow, though it downgraded the stock to a market perform on expectations of a softer longer-term outlook relative to its history.
Nancy Tengler, chief investment officer at Laffer Tengler Investments, backs O'Reilly as her top pick in the space.
"That's how we want to play the used car market," Tengler told CNBC's "Trading Nation" on Tuesday. "If you're a long-term investor and you own O'Reilly, for example, you want to hang on to that."
O'Reilly has risen 11% in the past month. The stock hit a high as recently as Monday.
Miller Tabak chief market strategist Matt Maley is also bullish on the group for the long term.
"The stocks continue on a technical basis to make nice higher lows and higher highs, including a nice higher high just recently," Maley said during the same interview. "Both those things bode well on a long-term basis."
But, after such strong performances this year, Maley is a little more cautious over the short term.
"If you look at their weekly RSI charts, relative strength index, they are getting overbought. So therefore, although you can continue to nibble at them here, you should wait to be aggressive until they pull back a little bit," Maley said.
AutoZone, AutoNation, Advance Auto Parts and O'Reilly all trade with a weekly RSI reading above 65. Any reading above 70 is generally considered an overbought condition.
Disclosure: Laffer Tengler Investments hold ORLY.