Assessing Copart (CPRT) Valuation As Competition And Slower Growth Challenge Its Premium Rating

Simply Wall St.01-11

Recent commentary around Copart (CPRT) has focused on rising competition from IAA, backed by RB Global, and the effect on market share, growth momentum, and investor confidence in the company’s ...

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These figures suggest momentum has been...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":["rate"],"viewcount":null,"language":"en","relate_stocks":{"CPRT":"科帕特"},"translate_title":"评估Copart(CPRT)的估值，因为竞争和增长放缓对其溢价评级构成挑战","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CPRT":1.5},"content_text":"Recent commentary around Copart (CPRT) has focused on rising competition from IAA, backed by RB Global, and the effect on market share, growth momentum, and investor confidence in the company’s premium valuation. See our latest analysis for Copart. Copart’s share price has been choppy, with a 2.02% 1 day share price return and 5.45% 7 day share price return, but a 9.23% 90 day share price decline and 28.41% 1 year total shareholder return decline. These figures suggest momentum has been fading as competition pressures its premium valuation. If competition in auto services has you reassessing your watchlist, it could be a useful moment to broaden your search and check out auto manufacturers. With Copart’s shares down over the past year but still carrying a premium valuation and trading below some analyst estimates of intrinsic value, investors may be asking whether the recent weakness is opening a buying window or whether the market is already pricing in future growth. AdvertisementMost Popular Narrative: 18.5% Undervalued With Copart last closing at US$39.83 against a narrative fair value of US$48.89, the current price sits at a clear discount to that framework.  Expanding value-added services, such as title processing, transportation, and loan payoff support, are increasing ancillary revenues and improving EBITDA margins, underpinning the company's ability to grow earnings ahead of core unit volumes.  Read the complete narrative. Curious what kind of earnings path and margin profile could justify this gap between price and fair value? The narrative leans heavily on steady compounding, richer fee mix, and a future valuation multiple that is usually reserved for high quality compounders. Want to see exactly which revenue and profit assumptions sit under that headline fair value and how they link back to the current P/E? Read on to see the full picture behind this call. Result: Fair Value of $48.89 (UNDERVALUED) Have a read of the narrative in full and understand what's behind the forecasts. However, this story can break if accident volumes or insurance driven total loss assignments soften, or if competitors and insurers pressure Copart’s fees and market share. Find out about the key risks to this Copart narrative.  Build Your Own Copart Narrative If you see Copart’s setup differently, or prefer testing the numbers yourself, you can create your own narrative in minutes with Do it your way. A good starting point is our analysis highlighting 4 key rewards investors are optimistic about regarding Copart. Looking for more investment ideas? If you stop with one stock, you risk missing other opportunities that better fit your goals, risk comfort, and preferred themes across sectors and styles.  Spot potential deep value opportunities by scanning these 879 undervalued stocks based on cash flows that align with your expectations around cash flows and balance sheet strength. Tap into growth themes in digital assets through these 79 cryptocurrency and blockchain stocks if you want listed companies tied to blockchain and cryptocurrency developments. Target income-focused ideas with these 12 dividend stocks with yields > 3% when you want companies offering yields above 3% alongside the potential for capital returns.   This article by Simply Wall St is general in nature. We provide commentary based on historical data\n    and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your\n    financial situation. We aim to bring you long-term focused analysis driven by fundamental data.\n    Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.\n    Simply Wall St has no position in any stocks mentioned.New: AI Stock Screener & AlertsOur new AI Stock Screener scans the market every day to uncover opportunities.• Dividend Powerhouses (3%+ Yield)• Undervalued Small Caps with Insider Buying• High growth Tech and AI CompaniesOr build your own from over 50 metrics.Explore Now for FreeHave feedback on this article? Concerned about the content? Get in touch with us directly. 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