Copart
CPRT
$33.72
+0.42%
Copart Inc. is a global leader in online vehicle auctions, specializing in the sale of salvage and used vehicles through its VB3 platform, serving insurance companies, fleet operators, and individual sellers across 11 countries. As the dominant player in the salvage vehicle auction market, Copart differentiates itself through its extensive network of buyers and sellers, technology-driven auction platform, and scale, processing over 4 million transactions annually. The current investor narrative centers on the company's growth trajectory amid a challenging environment, as recent Q2 earnings disappointed and raised concerns about volume growth, while the stock has experienced significant volatility, with a 32.5% decline over the past year. Additionally, the Supreme Court's ruling on tariffs has been cited as a potential tailwind for the broader market, but Copart's specific exposure to trade policies remains a point of debate.…
CPRT
Copart
$33.72
Related headlines
Investment Opinion: Should I buy CPRT Today?
Based on the analysis, Copart is rated a Hold. The consensus analyst recommendation is 'Buy' with an average target of $41.00, implying a 21.6% upside, but the sharp growth deceleration and high valuation warrant caution. The thesis is that Copart's dominant market position and strong margins provide a floor, but the lack of near-term catalysts and uncertain volume recovery limit upside potential.
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CPRT 12-Month Price Forecast
The AI assessment is neutral with medium confidence. Copart's strong fundamentals—dominant market position, high margins, and solid balance sheet—are offset by a sharp growth slowdown and a valuation that still prices in a significant recovery. The stock's recent stabilization and analyst buy ratings suggest some upside, but the lack of clear catalysts for volume growth limits conviction. I would upgrade to bullish if revenue growth re-accelerates above 5% and the stock holds above its 200-day moving average; I would downgrade to bearish if revenue growth turns negative or margins compress below 35%.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Copart's 12-month outlook, with a consensus price target around $41.00 and implied upside of +21.6% versus the current price.
Average Target
$41.00
0 analysts
Implied Upside
+21.6%
vs. current price
Analyst Count
—
covering this stock
Price Range
$25 - $55
Analyst target range
The target price range spans from a low of $25.00 to a high of $55.00, representing a wide 120% spread between the bearish and bullish cases. The low target of $25.00 suggests a potential 25.9% downside, likely pricing in continued volume declines and margin pressure, while the high target of $55.00 implies a 63.1% upside, assuming a successful turnaround and multiple expansion. The wide range reflects high uncertainty about Copart's growth prospects, with recent ratings showing no major changes (JP Morgan and Barclays maintained their ratings in February 2026), indicating analysts are waiting for clearer signs of stabilization before adjusting their outlooks.
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Bulls vs Bears: CPRT Investment Factors
Copart presents a mixed picture: it boasts a dominant market position, exceptional profitability, and a fortress balance sheet, but faces a sharp growth slowdown and significant valuation concerns. The bear case is currently stronger, as the deceleration in revenue growth and the stock's persistent downtrend outweigh the company's fundamental strengths. The most critical tension is whether Copart can reignite volume growth—if it does, the stock could re-rate higher; if not, the high valuation and negative momentum could drive further downside. Investors should closely monitor quarterly volume trends and management guidance for signs of stabilization.
Bullish
- Dominant Market Position: Copart is the global leader in online vehicle auctions, processing over 4 million transactions annually with 750,000+ registered buyers. This scale creates a powerful network effect that is difficult for competitors to replicate, supporting long-term pricing power and volume growth.
- High Profitability and Margins: Copart maintains exceptional profitability with a trailing net margin of 33.4% and operating margin of 36.5% in the latest quarter. Gross margin expanded to 46.3% in Q3 FY2026, up from 45.6% a year ago, demonstrating the company's ability to sustain pricing power despite volume challenges.
- Strong Balance Sheet: Copart has a debt-to-equity ratio of just 0.011 and a current ratio of 8.25, indicating minimal leverage and ample liquidity. This financial strength provides flexibility for strategic investments and resilience against economic downturns.
- Analyst Consensus Buy: With a consensus rating of 'Buy' and an average target price of $41.00, analysts see a 21.6% upside from the current price of $33.72. The high target of $55.00 implies a 63.1% upside, reflecting confidence in a potential recovery.
Bearish
- Sharp Revenue Growth Deceleration: Revenue growth slowed to just 2.1% YoY in Q3 FY2026, down from 5.7% in the prior quarter and well below the double-digit growth rates of previous years. This deceleration suggests weakening demand for salvage vehicles, a core driver of Copart's business.
- Significant Underperformance vs. Market: CPRT has declined 32.5% over the past year, while the S&P 500 gained 18.7%, resulting in a relative underperformance of over 51 percentage points. This persistent downtrend reflects investor concerns about the company's growth prospects.
- High Valuation with Stretched PEG: Despite the price decline, the trailing PE of 28.2x and PEG of 2.1x indicate the stock is not cheap relative to its growth rate. The market is pricing in a significant earnings recovery, leaving little room for disappointment.
- Q2 Earnings Disappointment: Copart's Q2 FY2026 earnings disappointed the market, causing a stock drop and raising concerns about volume growth. The Q2 revenue growth of only 5.7% YoY (later decelerating further) suggests the company is facing structural headwinds, not just temporary cyclical issues.
CPRT Technical Analysis
Copart's stock is in a pronounced downtrend over the past year, with a 1-year price change of -32.5%, significantly underperforming the S&P 500's +18.7% gain. The current price of $33.72 sits at 28.4% of its 52-week range (between the low of $26.81 and high of $49.16), indicating the stock is trading near the lower end of its yearly range, which often suggests a potential value opportunity but also reflects persistent selling pressure. The stock's beta of 1.014 indicates volatility roughly in line with the market, offering no cushion against broader market swings.
Beta
1.03
1.03x market volatility
Max Drawdown
-45.6%
Largest decline past year
52-Week Range
$27-$49
Price range past year
Annual Return
-32.5%
Cumulative gain past year
| Period | CPRT Return | S&P 500 |
|---|---|---|
| 1m | +16.6% | -0.4% |
| 3m | +8.9% | +4.5% |
| 6m | -10.7% | +13.9% |
| 1y | -32.5% | +19.0% |
| ytd | -10.7% | +12.9% |
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CPRT Fundamental Analysis
Copart's revenue growth has decelerated sharply, with the most recent quarter (Q3 FY2026, ending April 30, 2026) showing only 2.1% YoY growth to $1.24 billion, down from 5.7% growth in the prior quarter. This marks a significant slowdown from the double-digit growth rates seen in prior years, reflecting challenges in vehicle volume and pricing. The company's revenue mix is heavily skewed toward services, which generated $1.06 billion (85.4% of total revenue) in the latest quarter, while product revenue contributed $181 million, indicating the core auction and fee-based services remain the primary growth engine.
Quarterly Revenue
$1.2B
2026-04
Revenue YoY Growth
+2.1%
YoY Comparison
Gross Margin
46.3%
Latest Quarter
Free Cash Flow
$1.3B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
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Valuation Analysis: Is CPRT Overvalued?
Given Copart's positive net income, the PE ratio is the primary valuation metric. The trailing PE stands at 28.2x, while the forward PE is 20.1x, implying the market expects earnings growth of approximately 40% over the next year. This forward discount suggests optimism about a recovery in earnings, but the PEG ratio of 2.1x indicates that the growth expectations may be stretched relative to the company's historical growth rate.
PE
28.2x
Latest Quarter
vs. Historical
Mid-Range
5-Year PE Range 19x~38x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
19.5x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks stem from Copart's reliance on continued revenue growth to justify its valuation. With revenue growth decelerating to 2.1% YoY in the latest quarter, the company's high fixed-cost base could lead to margin compression if volumes continue to decline. The trailing PE of 28.2x and PEG of 2.1x imply the market expects a significant earnings rebound; any shortfall could trigger a de-rating. Additionally, Copart's heavy dependence on insurance companies for vehicle supply (about 80% of volume) creates concentration risk, as changes in insurer claims behavior or total-loss thresholds could directly impact volumes.
FAQ
The key risks for Copart include: (1) Financial risk: revenue growth deceleration to 2.1% YoY could lead to margin compression if volumes continue to decline. (2) Competitive risk: new entrants or technological disruption could erode Copart's market share. (3) Macro risk: an economic recession could reduce vehicle accidents and total-loss claims, directly impacting volumes. (4) Company-specific risk: dependence on insurance companies for 80% of vehicle supply creates concentration risk. The most severe risk is a prolonged volume decline, which could push the stock down to the analyst low target of $25.00, a 25.9% downside from the current price.
The 12-month forecast for Copart is uncertain, with a wide range of outcomes. In the bull case (25% probability), the stock could reach $45-$55, driven by a return to double-digit growth. In the base case (50% probability), the stock is likely to trade in the $35-$45 range, reflecting modest growth. In the bear case (25% probability), the stock could fall to $25-$30 if growth turns negative. The most likely scenario is the base case, which assumes revenue growth stabilizes at low single digits and margins remain strong. Investors should watch quarterly volume trends and management guidance for signals.
Copart's valuation is mixed. The trailing PE of 28.2x is above the market average, but the forward PE of 20.1x suggests the market expects significant earnings growth. The PEG ratio of 2.1x indicates that the stock is not cheap relative to its growth rate, implying that the market is pricing in a recovery. Compared to its own history, the stock is trading at a discount to its five-year average PE, but it is still not undervalued in absolute terms. The valuation implies that investors expect Copart to return to double-digit earnings growth, which is a high bar given the recent revenue deceleration.
Copart is a good buy for investors with a long-term horizon who are comfortable with near-term volatility. The stock offers a 21.6% upside to the average analyst target of $41.00, and the company's dominant market position and strong margins provide a solid foundation. However, the sharp revenue growth deceleration and high valuation (PEG of 2.1x) mean that the stock is not a bargain. It is best suited for investors who believe in the long-term growth of the salvage vehicle market and are willing to hold through the current downturn. For those seeking quick gains, the lack of near-term catalysts may be a deterrent.
Copart is more suitable for long-term investment due to its dominant market position and strong cash flow generation. The stock's beta of 1.014 indicates market-level volatility, and the recent 32.5% decline over the past year highlights the risks of short-term trading. The company does not pay a dividend, so returns depend on capital appreciation, which is likely to be driven by long-term growth in the salvage vehicle market. A minimum holding period of 3-5 years is recommended to allow the company to navigate the current growth slowdown and potentially benefit from a recovery in volumes.
