Copart (CPRT) Analysis

This report is auto-generated by an AI stock research platform for informational purposes only. The content is for general information and research reference, and does not constitute financial advice. Data may lag or be incomplete. Always conduct your own research and consult qualified professionals before making any financial decisions. # [Qiltrack AI] Copart Inc (CPRT) 3-Minute Overview ### 🎯 Layer 1: 30-Second Key Takeaways > **💡 One-Sentence Summary** > > Simply put, Copart is an online vehicle auction platform that quietly runs a very high-margin, asset-light-ish marketplace around salvage and used cars—and the main story right now is great business quality versus clearly slowing near-term growth. > **📍 Basic Profile** > > Market Cap **$33.14 billion** · Commercial Services & Supplies · NASDAQ NMS - GLOBAL MARKET · Price **$34.40** > **⚡ 3 Things You Should Know** > > 1. 💰 Cash-rich, debt-free operator: Copart posts a **33.76% net margin** and carries **no debt**, which is rare for a company tied to physical operations. In other words, this is a very efficient business with a lot of room to absorb bad cycles. > > 2. 📉 Great company, slower moment: Long-term growth has been solid, but the latest quarter only showed about **2.1% revenue growth**, and recent coverage points to pressure from unit volumes and fuel costs. That matters because the market used to pay up for steadier growth. > > 3. 🏷️ Valuation has cooled a lot: The stock is sitting **near its 52-week low** and trades at about **20.2x earnings**, which is much less demanding than many high-quality compounders. Basically, the market is no longer pricing this like a flawless growth story. > **🎯 Quick Health Check** > > | Dimension | Rating | Details | > |-----------|--------|---------| > | Profitability | Strong💪 | Net margin **33.76%**, unusually high for this type of business | > | Growth Rate | Steady📈 | 3-year revenue growth **9.9%**, but latest quarter slowed | > | Financial Health | Healthy💚 | Debt ratio **0%**, current ratio **10.06** | > | Valuation | Fair | PE **20.23x**, but sentiment reflects slower growth | --- ### 📋 Layer 2: 2-Minute Deep Dive #### 📊 How Does This Company Make Money? **Business Model in One Sentence:** Copart runs online vehicle auctions, mainly selling salvaged and used vehicles to insurers, dismantlers, dealers, and exporters, making money through auction fees and related service charges. **Revenue Breakdown:** | Business | Share | Trend | Comment | |----------|-------|-------|---------| | Vehicle auction marketplace | [Data unavailable] | ↑ | Core engine of the company; scale and network effects matter a lot here | | Related services / fees | [Data unavailable] | → | Supports margins, but no segment split was provided | **Profitability Metrics:** | Metric | Value | Ranking | Interpretation | |--------|-------|---------|----------------| | Gross Margin | 45.34% | Top tier | Very strong for an operations-heavy service business; suggests pricing power and efficiency | | Net Margin | 33.76% | Top tier | This is the standout number—Copart keeps a huge share of revenue as profit | | ROE | 16.68% | Good 15% | Healthy returns even without leverage, which makes the quality more credible | --- #### 📈 How's the Growth? **Growth Assessment:** Slowing | Metric | Latest | vs Last Year | Trend | |--------|--------|--------------|-------| | Revenue Growth | 2.1% | Below 3Y avg 9.9% | Slowing | | Profit Growth | [Data unavailable] | Recent news suggests slight net income decline | Slowing | **Growth Quality:** > What’s interesting is that Copart’s longer-term record is still solid—**5-year revenue growth of 16.07%** and **5-year EPS growth of 16.72%**—but the latest quarter looks softer. So this doesn’t look like a broken business; it looks more like a high-quality company going through a slower patch, with some cost pressure mixed in. --- #### 💰 Financial Health Check **One Sentence:** This looks like someone with a paid-off house, a big cash cushion, and no credit card debt. | Metric | Value | Safe Zone | Assessment | |--------|-------|-----------|------------| | Debt Ratio | 0% debt-to-equity | <60% safe | ✅Safe | | Current Ratio | 10.06 | >1.5 healthy | ✅Safe | | Cash Flow | $0.77/share | >0 | ✅Positive | --- #### 🏷️ Is It Expensive Now? **Price Position (based on 52-week range):** - 52-Week Low: $32.20 - 52-Week High: $61.66 - Current: $34.40, **near the low** | Position Range | Cheap Zone | Fair Zone | Pricey Zone | |----------------|------------|-----------|-------------| | Criteria | 0-33% | 33-66% | 66-100% | | **Current** | ●(7% position) | | | **Valuation Comparison:** | Comparison | Current | Reference | Assessment | |------------|---------|-----------|------------| | vs Own History | PE 20.23x | [Data unavailable] | [Data unavailable] | | vs Peers | PE 20.23x | Industry avg [Data unavailable] | [Data unavailable] | **What the Current Valuation is Betting On:** > Basically, the market is saying: “We still believe Copart is a high-quality business, but we’re no longer willing to pay a premium unless growth re-accelerates.” At this price, investors seem to be betting more on resilience and durability than on rapid expansion. --- #### 📰 Any Recent News? | Date | Event | Impact | |------|-------|--------| | 2026-05-21 | Q3 2026 earnings beat on EPS and revenue | Positive + beat estimates, which helps support confidence in execution | | 2026-05-21 | Revenue growth only 2.1%, with unit sales and fuel-cost pressure discussed on call | Neutral/Negative + business held up, but growth quality looks softer than headline beats suggest | | 2026-05-21 | Shares reportedly dipped after earnings despite beat | Neutral + tells you expectations around growth are still the real issue | --- ### 📊 Layer 3: Want More? 3-Minute Complete Analysis #### I. Detailed Financial Data **Profitability Trends:** | Metric | This Year | Last Year | Year Before | 3-Year Trend | |--------|-----------|-----------|-------------|--------------| | Gross Margin | 45.34% | [Data unavailable] | [Data unavailable] | → | | Net Margin | 33.76% | [Data unavailable] | [Data unavailable] | → | | ROE | 16.68% | [Data unavailable] | [Data unavailable] | → | **Growth Trends:** | Metric | This Year | Last Year | Year Before | 3-Year Trend | |--------|-----------|-----------|-------------|--------------| | Revenue Growth | 2.1% recent quarter / 9.9% 3Y CAGR | [Data unavailable] | [Data unavailable] | ↓ | | Profit Growth | [Data unavailable] | [Data unavailable] | [Data unavailable] | ↓ | | EPS Growth | 12.01% 3Y CAGR | [Data unavailable] | [Data unavailable] | → | --- #### II. Earnings Track Record **Last 4 Quarters vs Expectations:** | Quarter | EPS Expected | EPS Actual | Surprise | |---------|--------------|------------|----------| | 2026-06-30 | $0.41 | $0.43 | +3.79% Beat 😀 | | 2026-03-31 | $0.40 | $0.36 | -10.00% Miss 😟 | | 2025-12-31 | $0.40 | $0.41 | +3.46% Beat 😀 | | 2025-09-30 | $0.37 | $0.41 | +11.38% Beat 😀 | **Earnings Trend Interpretation:** Copart has still beaten estimates in **3 of the last 4 quarters**, which says execution is generally solid. Worth noting, though: the one miss and the muted market reaction to the latest beat suggest investors are focusing less on “did they beat?” and more on “is growth slowing structurally?” --- #### III. What the Market Thinks **Analyst Ratings:** | Rating | Count | Percentage | |--------|-------|------------| | Strong Buy/Buy | 12 firms | 60% | | Hold | 7 firms | 35% | | Sell | 1 firm | 5% | **Target Price:** [Data unavailable] ~ [Data unavailable] (Median [Data unavailable]) **vs Current Price:** [Data unavailable] **Insider Activity:** Net selling in past 3 months > Most of the disclosed insider activity is tied to CEO Jeffrey Liaw, including **M-coded option-related transactions** and some **S-coded sales**. I wouldn’t overreact to this by itself, because option exercises often create noisy insider data—but it’s still not as encouraging as open-market buying. --- #### IV. Key Risk Alerts **3 Risks to Watch:** 1. **Growth slowdown risk:** Latest revenue growth was only **2.1%** → If this continues, the stock may stay cheap even if the business remains profitable 2. **Cost pressure risk:** Rising fuel and operating costs were flagged in recent commentary → If costs rise faster than fees, margins could gradually compress 3. **Volume sensitivity risk:** Weakness in unit sales was mentioned alongside earnings → If salvage volumes or auction throughput soften, growth may remain under pressure --- ### 🎬 Summary & Next Steps > **📝 Three-Sentence Summary** > > **What it is:** Copart is a highly profitable online vehicle auction business with a niche market position and a very clean balance sheet. > > **Key strength:** Its standout advantage is business quality—**high margins, no debt, strong liquidity, and solid long-term compounding**. > > **Key risk:** The big question now is whether the recent **growth slowdown** is temporary noise or the start of a lower-growth phase that justifies a lower valuation. --- > **🔍 Want to Learn More?** > > • Want to know if this company has a strong moat? → Try【Buffett Mode】for deeper analysis > > • Want to check for hidden landmines? → Try【Muddy Mode】for risk screening > > • Is this a growth stock? Want to calculate if it's worth the bet? → Try【Musk Mode】for analysis