Breaking Down This Vehicle Giant's Earnings History

Is CPRT currently overvalued or undervalued?

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Copart, Inc. (NASDAQ:CPRT) is a global online vehicle auction company. Copart’s technology and online auction platform links sellers to more than 750,000 members in over 170 countries. The company offers services to process and sell salvage and clean title vehicles to dealers, dismantlers, rebuilders, exporters and, in some cases, to end users. Copart sells vehicles on behalf of insurance companies, banks, finance companies, charities, fleet operators, dealers, and individual owners. This morning, CPRT was last seen down 1.4% at $119.23 in electronic trading.

CPRT has increased about 50% over the past year. Copart stock reached a 52-week low of $77.69 in May 2020, and remain down 7.6% from November peak of $130.96. The equity is just above breakeven year-to-date..

The company is expected to report third quarter of 2021 earnings on Tuesday, May 18. In recent history, Copart has outperformed earnings expectations on three of its last four earnings reports. For the second quarter of 2020, the company missed analyst estimates by a margin of $0.06 and report an earnings per share (EPS) of $0.58. For the third quarter of 2020, Copart's EPS increased to $0.69, and beat expectations by a big margin of $0.31. For the fourth quarter, CPRT reported another increase in earnings, rising to $0.79 per share and beat estimates by a margin of $0.08. In the most recent quarterly report, Copart posted an EPS of $0.80 and beat expectations by a margin of $0.01.

From a purely fundamental perspective, Copart is solid all-around apart from its valuation. Copart stock currently trades at a high price-earnings ratio of 41.02 and has a forward price-earnings ratio of 35.09. However, the valuation is justified by the company’s consistent revenue and net income growth.

The company's balance sheet is in good standing with $616.4 million in cash and $511.81 million in debt. Overall, buying Copart stock is a decent option for long-term investors and investors can likely count on the stock to appreciate nicely over time if the company maintains its current form.


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