William Blair analyst Dylan Becker has maintained their bullish stance on KARO stock, giving a Buy rating on July 16.
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Dylan Becker has given his Buy rating due to a combination of factors including Karooooo’s strong financial performance and growth prospects. The company reported a notable increase in subscription revenue by 18% on a constant-currency basis, surpassing internal expectations. Additionally, Karooooo achieved a record number of net subscriber additions, which rose by 17% year-over-year, indicating robust demand for its services.
Furthermore, Karooooo’s operating income exceeded consensus estimates, showcasing a healthy operating margin of 28%. The management’s reaffirmation of its fiscal 2026 guidance, with anticipated subscription revenue growth and a solid operating margin, further supports the positive outlook. The company’s shares are considered attractively valued, trading at a discount compared to peers, with potential for revaluation as it gains credibility in the U.S. market. Despite potential risks such as competition and foreign exchange fluctuations, the overall momentum and strategic positioning of Karooooo justify the Buy rating.
Becker covers the Technology sector, focusing on stocks such as Manhattan Associates, CCC Intelligent Solutions Holdings, and Blend Labs. According to TipRanks, Becker has an average return of 12.4% and a 64.22% success rate on recommended stocks.
In another report released on July 16, Needham also initiated coverage with a Buy rating on the stock with a $60.00 price target.