Analyst Joshua Reilly of Needham reiterated a Buy rating on Karooooo, retaining the price target of $60.00.
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Joshua Reilly has given his Buy rating due to a combination of factors, primarily driven by expectations of a modest second-quarter performance exceeding forecasts. The company, Karooooo, is anticipated to outperform in both subscription numbers and average revenue per user (ARPU). Despite slightly lower than expected adoption rates for Cartrack Tag and Video, the unit growth remains robust, supporting a positive outlook.
Reilly highlights the company’s strategic investments in the Asia-Pacific region as a significant contributor to their ambitious four-year goal of achieving a 19% compound annual growth rate in Cartrack subscriptions. This strategic direction, coupled with anticipated strong second-quarter earnings, is expected to act as a catalyst for the stock’s performance. Overall, the positive sentiment towards Karooooo’s shares is based on the company’s sales execution and growth potential in the coming quarters.
In another report released on October 6, Morgan Stanley also maintained a Buy rating on the stock with a $55.00 price target.