Copart (CPRT) AI Stock Analysis

• Market Cap: $45.89B
• Dividend Yield: N/A
• Average Volume (3M): 7.13M
• Price to Earnings (P/E): 31.1
• Beta (1Y): 1.00
• Revenue Growth: 10.21%
• EPS Growth: 5.94%
• Country: US
• Employees: 13,086
• Sector: Industrials
• Sector Strength: 91
• Industry: Auto - Dealerships
• EPS (TTM): 0.42
• Shares Outstanding: 966,936,200
• 10 Day Avg. Volume: 5,070,574
• 30 Day Avg. Volume: 7,132,485
• PEG Ratio: 23.25
• Price to Book (P/B): 5.19
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 38.58
• Enterprise Value/Market Cap: 0.94
• Enterprise Value/Revenue: 2.45
• Enterprise Value/Gross Profit: 21.19
• Enterprise Value/Ebitda: 6.18
• 1Y Price Target: $58.33
• Price Target Upside: 23.76% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 4

• Rating: 70 Outperform
• Price Target: $56.00 ▲(18.82%Upside)

Copart's strong financial performance and positive earnings call sentiments are tempered by technical analysis indicating current bearish trends and a high valuation. While the company is well-positioned for long-term growth due to strategic investments and robust revenue increases, the current market sentiment and valuation concerns suggest a cautious outlook in the short term.

Positive Factors

Earnings Growth

EPS of $0.40 increased 21% from $0.33 for the comparable period of FY/24.

Financial Performance

Global service revenue increased 15% to $991 million, while purchased vehicle sales rose 8.6% to $172 million.

Technological Leadership

Proactive levers that are driving CPRT’s growth include in-house AI-enabled image recognition tools, which can empower insurance companies to total cars more accurately and more effectively.

Negative Factors

Competitive Pressure

There is a more challenging backdrop due to high valuation, slowing profit growth and higher competitive/macro uncertainty.

Insurance Volume Decline

CPRT's US insurance volume growth of -1% year-over-year confirmed concerns around stalling volume growth and modest share losses.

Unit Growth Expectations

US inventory units down -11% year-over-year exiting-F3Q25 apply incremental downside pressure on forward unit growth expectations.

Copart Business Overview & Revenue Model

Company Description

Copart, Inc. provides online auctions and vehicle remarketing services in the United States, Canada, the United Kingdom, Brazil, the Republic of Ireland, Germany, Finland, the United Arab Emirates, Oman, Bahrain, and Spain. It offers a range of services for processing and selling vehicles over the internet through its virtual bidding third generation internet auction-style sales technology to vehicle sellers, insurance companies, banks and finance companies, charities, fleet operators, dealers, vehicle rental companies, and individuals. The company's services include online seller access, salvage estimation, estimating, end-of-life vehicle processing, virtual insured exchange, transportation, vehicle inspection stations, on-demand reporting, title processing and procurement, loan payoff, flexible vehicle processing programs, buy it now, member network, sales process, and dealer services. Its services also comprise services to sell vehicles through CashForCars.com; U-Pull-It service that allows buyer to remove valuable parts and sell the remaining parts and car body; copart 360, an online technology for posting vehicle images; membership tiers for those registering to buy vehicles through Copart.com; and virtual queue to secure a place in line while visiting one of its locations. The company sells its products principally to licensed vehicle dismantlers, rebuilders, repair licensees, used vehicle dealers, and exporters, as well as to the public. The company was incorporated in 1982 and is headquartered in Dallas, Texas.

How the Company Makes Money

Copart makes money primarily through the auctioning of vehicles on its online platform. The company's revenue model is based on transaction fees from both sellers and buyers who participate in the auctions. Sellers, such as insurance companies and dealerships, pay listing and service fees to have their vehicles listed for auction on Copart's platform. Buyers, who are typically dismantlers, rebuilders, and used vehicle dealers, pay a buyer's fee upon successfully winning a bid for a vehicle. Additionally, Copart generates income through membership fees, transportation services, and value-added services such as vehicle storage and title processing. Significant partnerships with insurance companies play a key role in ensuring a steady supply of vehicles for auction, which is crucial for the company's continued revenue growth.

Copart Financial Statement Overview

Summary

Copart exhibits excellent financial health characterized by strong profitability, a solid balance sheet, and robust cash flows. The company's consistent revenue and profit growth, low leverage, and strong cash generation position it well for sustained performance and growth in the auto dealership industry.

Income Statement

Copart has demonstrated strong revenue growth with a notable increase from $3.5 billion in 2022 to $4.6 billion TTM. Gross and net profit margins are robust, consistently exceeding 30%, indicating high profitability. EBIT and EBITDA margins are also impressive, showing effective cost management. The company has maintained a positive revenue growth trajectory, highlighting its competitive advantage in the industry.

Balance Sheet

The balance sheet is solid with a low debt-to-equity ratio, reflecting prudent financial leverage. High equity ratio indicates a strong asset base funded by equity, reducing financial risk. Return on Equity is strong, driven by high net income. The company has ample cash reserves, enhancing financial stability and flexibility.

Cash Flow

Copart's cash flow is strong with significant free cash flow generation, reflecting efficient operations. Free cash flow to net income ratio is favorable, indicating effective conversion of earnings into cash. Operating cash flow has grown consistently, supporting future growth investments. The company has maintained positive cash flow metrics, demonstrating solid cash management practices.

Breakdown	TTM	Sep 2024	Sep 2023	Sep 2022	Sep 2021	Sep 2020
Income Statement
Total Revenue	4.59B	4.24B	3.87B	3.50B	2.69B	2.21B
Gross Profit	2.04B	1.91B	1.74B	1.61B	1.34B	1.01B
EBITDA	1.86B	1.76B	1.49B	1.37B	1.14B	922.46M
Net Income	1.48B	1.36B	1.24B	1.09B	936.50M	699.91M
Balance Sheet
Total Assets	9.67B	8.43B	6.74B	5.31B	4.56B	3.46B
Cash, Cash Equivalents and Short-Term Investments	4.38B	3.42B	2.36B	1.38B	1.05B	477.72M
Total Debt	101.06M	118.73M	120.45M	119.47M	518.07M	518.19M
Total Liabilities	869.52M	879.21M	750.44M	683.26M	1.03B	965.75M
Stockholders Equity	8.78B	7.52B	5.99B	4.63B	3.53B	2.49B
Cash Flow
Free Cash Flow	1.18B	961.57M	847.57M	839.24M	527.89M	314.21M
Operating Cash Flow	1.80B	1.47B	1.36B	1.18B	990.89M	917.88M
Investing Cash Flow	-582.63M	-940.08M	-1.89B	-442.31M	-465.47M	-601.21M
Financing Cash Flow	52.56M	19.27M	66.61M	-382.69M	40.92M	-27.41M

Copart Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 47.13
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CPRT, the sentiment is Negative. The current price of 47.13 is below the 20-day moving average (MA) of 48.32, below the 50-day MA of 53.40, and below the 200-day MA of 55.94, indicating a bearish trend. The MACD of -1.30 indicates Negative momentum. The RSI at 30.51 is Neutral, neither overbought nor oversold. The STOCH value of 13.92 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for CPRT.

Copart Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LAD	82 Outperform	$9.12B	11.04	12.95%	0.63%	12.96%	-6.25%
SAH	76 Outperform	$3.00B	12.59	24.52%	1.59%	1.59%	43.91%
CPRT	70 Outperform	$45.89B	31.15	18.54%	―	10.21%	5.94%
KMX	66 Neutral	$9.66B	18.03	8.97%	―	3.17%	42.14%
ACVA	64 Neutral	$2.75B	―	-16.49%	―	32.89%	7.44%
KAR	61 Neutral	$2.68B	42.77	5.46%	―	9.42%	―
Sector *	58 Neutral	HK$14.16B	4.51	-3.01%	6.93%	3.67%	-54.16%