Karooooo (KARO) AI Stock Analysis

• Market Cap: $1.40B
• Dividend Yield: 2.66%
• Average Volume (3M): 32.08K
• Price to Earnings (P/E): 25.5
• Beta (1Y): 1.23
• Revenue Growth: 18.30%
• EPS Growth: 22.19%
• Country: US
• Employees: 4,387
• Sector: Technology
• Sector Strength: 88
• Industry: Software - Application
• EPS (TTM): 0.50
• Shares Outstanding: 30,893,300
• 10 Day Avg. Volume: 33,554
• 30 Day Avg. Volume: 32,079
• PEG Ratio: 1.25
• Price to Book (P/B): 8.12
• Price to Sales (P/S): 5.71
• P/FCF Ratio: 28.08
• Enterprise Value/Market Cap: 1.17
• Enterprise Value/Revenue: 0.33
• Enterprise Value/Gross Profit: 0.47
• Enterprise Value/Ebitda: 0.76
• 1Y Price Target: $58.33
• Price Target Upside: 26.78% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3
• EPS Forecast (FY): 2.03
• Revenue Forecast (FY): $330.64M

• Rating: 76 Outperform
• Price Target: $50.00 ▲(8.67% Upside)

Karooooo's strong financial performance and positive earnings call sentiment are the most significant factors driving the score. While technical indicators suggest a bearish trend, the company's robust growth metrics and fair valuation provide a balanced outlook.

Positive Factors

Revenue Growth

Strong revenue growth indicates robust demand for Karooooo's services, enhancing its market position and supporting long-term financial stability.

Customer Retention

High customer retention demonstrates customer satisfaction and loyalty, ensuring a stable revenue base and reducing acquisition costs.

Cash Flow Management

Exceptional cash flow growth highlights effective cash management, providing resources for reinvestment and financial resilience.

Negative Factors

Sales Force Challenges

Underperformance of new sales reps can hinder revenue growth and market expansion, impacting long-term sales productivity.

Expansion Bottlenecks

Expansion delays can restrict market penetration and slow growth, affecting the company's ability to capitalize on demand.

Tax Impacts

Tax impacts can reduce net earnings, affecting profitability and potentially limiting reinvestment capacity.

Karooooo Business Overview & Revenue Model

Company Description

Karooooo Ltd. provides mobility software-as-a-service (SaaS) platform for connected vehicles in South Africa, rest of Africa, Europe, the Asia-Pacific, the Middle East, and the United States. The company offers Fleet Telematics, a fleet management SaaS platform that provides real-time insights; LiveVision, which offers pro-active risk management and fleet visibility; MiFleet advanced fleet administration and business intelligence that provides cost management and administration capability services; and Karooooo Logistics, a software application for management of last mile delivery and general operational logistics. It also provides Cartrack Field Service, a software application for management of field and on site workers; Business Intelligence for high-level view of fleet statistics; asset tracking for tracking and tracing moveable assets; asset recovery services that assists vehicle owners and insurance companies with the recovery of vehicles and other assets; and insurance telematics that allows insurers to tailor premiums for commercial and consumer customers using analytics; Protector, a safety package for consumer vehicles; and Car Watch, a mobile application that lets users track and watch their vehicles. In addition, the company offers specialist mobility solutions that include Bike Track, a GPS-based solution for commercial motorbike fleets; Credit Management that predicts payment cycles and facilitate active credit management for asset-based vehicle finance; electronic monitoring services application that allows law enforcement agencies to monitor persons of interest; and mobility and monitoring solutions, such as Carzuka, cartrack insurance agency, and on-demand rideshare taxi application, as well as smart IoT products. It provides its solutions through direct sales force to consumers and sole proprietors, small and medium-sized businesses, large enterprises, and other connected devices. Karooooo Ltd. was founded in 2001 and is headquartered in Singapore.

How the Company Makes Money

Karooooo generates revenue primarily through subscription fees for its software services. The company offers tiered pricing models based on the number of vehicles being monitored, with additional charges for premium features and advanced analytics. Key revenue streams include monthly and annual subscriptions from fleet management clients, as well as ancillary services such as maintenance and support. Significant partnerships with automotive manufacturers and integration with third-party applications also contribute to its earnings, expanding its market reach and enhancing the value of its service offerings.

Karooooo Financial Statement Overview

Summary

Karooooo exhibits impressive financial health with strong revenue growth, robust profitability, and a stable balance sheet with low leverage. Cash flows have improved substantially, highlighting excellent cash management.

Income Statement

Karooooo shows robust financial performance with consistent revenue growth and strong profitability. Gross Profit Margin improved to 70.11% in 2025 from 64.00% in 2024. Net Profit Margin increased to 20.17% in 2025 from 17.55% in 2024. Revenue Growth Rate was 8.61% in 2025, showcasing a strong upward trend. EBIT and EBITDA margins are healthy, reflecting operational efficiency.

Balance Sheet

The balance sheet is strong with a Debt-to-Equity Ratio of 0.23 in 2025, indicating low leverage. The Return on Equity improved to 28.76% in 2025, signifying effective use of equity. The Equity Ratio stands at 63.05%, reflecting a well-capitalized structure. Overall, the company maintains a stable financial position with low financial risk.

Cash Flow

Karooooo demonstrates solid cash flow performance. Free Cash Flow Growth Rate surged by 2102.97% in 2025, showcasing exceptional improvement. Operating Cash Flow to Net Income Ratio is strong at 2.10, indicating excellent cash conversion. Free Cash Flow to Net Income Ratio is 0.93, reflecting effective cash management despite high capital expenditures.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	5.03B	4.57B	4.21B	3.51B	2.75B	2.06B
Gross Profit	3.49B	3.20B	2.69B	2.27B	1.82B	1.46B
EBITDA	2.15B	2.07B	1.83B	1.51B	1.26B	1.03B
Net Income	1.00B	921.03M	751.90M	597.15M	449.95M	285.97M
Balance Sheet
Total Assets	4.93B	5.10B	4.27B	3.72B	3.04B	2.86B
Cash, Cash Equivalents and Short-Term Investments	420.82M	1.05B	456.03M	957.38M	719.21M	967.58M
Total Debt	654.98M	727.53M	263.86M	179.14M	211.46M	1.00B
Total Liabilities	1.88B	1.84B	1.29B	1.05B	899.74M	1.60B
Stockholders Equity	2.99B	3.21B	2.94B	2.64B	2.11B	838.18M
Cash Flow
Free Cash Flow	0.00	928.88M	80.15M	595.43M	387.59M	413.27M
Operating Cash Flow	1.60B	1.97B	972.78M	1.23B	952.64M	842.91M
Investing Cash Flow	-1.13B	-1.10B	-949.50M	-677.29M	-740.88M	-475.67M
Financing Cash Flow	-746.83M	-452.00M	-603.97M	-457.21M	-442.92M	-426.42M

Karooooo Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 46.01
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KARO, the sentiment is Negative. The current price of 46.01 is below the 20-day moving average (MA) of 46.23, above the 50-day MA of 45.39, and below the 200-day MA of 47.56, indicating a bearish trend. The MACD of -0.14 indicates Positive momentum. The RSI at 46.07 is Neutral, neither overbought nor oversold. The STOCH value of 37.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for KARO.

Karooooo Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
KARO	76 Outperform	$1.40B	25.48	34.42%	2.66%	18.30%	22.19%
JAMF	62 Neutral	$1.75B	-41.30	-5.48%	―	12.28%	42.19%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
SPT	61 Neutral	$603.94M	-12.61	-26.69%	―	13.09%	32.34%
PRCH	57 Neutral	$948.34M	36.89	―	―	-2.13%	―
AMPL	52 Neutral	$1.37B	-12.87	-37.47%	―	12.78%	-20.47%

Karooooo Corporate Events

Karooooo Sets January 20 Date for Third Quarter 2026 Results

On January 12, 2026, Karooooo Limited announced that it plans to release its Third Quarter 2026 financial results on January 20, 2026, after the U.S. market close, and will host a follow-up Zoom webinar on January 21, 2026 to discuss the numbers with investors. The scheduled release and investor call underscore the company’s ongoing engagement with the market and will give stakeholders a timely update on its operational and financial performance as it continues to scale its digital operations and logistics platforms across multiple geographies.

The most recent analyst rating on (KARO) stock is a Buy with a $55.00 price target. To see the full list of analyst forecasts on Karooooo stock, see the KARO Stock Forecast page.

Karooooo Reports Strong Q2 2026 Financial Results with Significant Growth

On October 14, 2025, Karooooo Ltd. announced its unaudited financial results for the second quarter and half-year of 2026, showing significant growth in several key areas. The company reported a 20% year-over-year increase in Cartrack’s subscription revenue and SaaS annualized recurring revenue, alongside a 15% rise in subscribers, reaching 2.5 million. Karooooo’s adjusted earnings per share rose by 13%, and the company reaffirmed its fiscal year 2026 outlook, highlighting its ability to scale and maintain a strong financial position. These results underscore Karooooo’s robust market positioning and potential positive implications for stakeholders.

The most recent analyst rating on (KARO) stock is a Buy with a $55.00 price target. To see the full list of analyst forecasts on Karooooo stock, see the KARO Stock Forecast page.