Financial Performance - Service revenues for fiscal 2024 increased by $362.9 million, or 11.3%, compared to fiscal 2023, driven by a $284.5 million increase in the U.S. and a $78.4 million increase internationally[165]. - Total vehicle sales for fiscal 2024 increased by $4.4 million, or 0.7%, compared to fiscal 2023, with a decrease of $9.4 million in the U.S. offset by an increase of $13.8 million internationally[166]. - Operating income for fiscal 2024 was 37% of total revenues, down from 39% in fiscal 2023[163]. - Total operating expenses for fiscal 2024 increased to 63% of total revenues, compared to 61% in both fiscal 2023 and 2022[163]. - Net income for fiscal 2024 was 32% of total revenues, a decrease from 34% in fiscal 2023[163]. - International service revenues grew by 22.0% in fiscal 2024 compared to fiscal 2023, reaching $434.9 million[164]. - U.S. service revenues increased by 10.0% in fiscal 2024 compared to fiscal 2023, totaling $3,126.1 million[164]. - Vehicle sales totaled $675.8 million in fiscal 2024, slightly up from $671.4 million in fiscal 2023, indicating a growth of 0.6%[198]. Operational Developments - The company processed 81%, 83%, and 80% of total vehicles from insurance company sellers in fiscal years 2024, 2023, and 2022 respectively[147]. - The average age of cars on the road increased from 11.1 years in 2012 to 12.6 years in 2024, indicating a growing market for salvage vehicles[151]. - The company acquired a controlling interest in Purple Wave, an online offsite heavy equipment auction company, in October 2023[161]. - The company plans to expand its operations by acquiring and developing additional vehicle storage facilities in key markets, including foreign markets[162]. - The company aims to increase service offerings and pursue global, national, and regional vehicle seller agreements to boost revenues and profitability[162]. - The company operates in multiple countries including the U.S., U.K., Germany, Brazil, and Canada, providing a wide geographic service area[144]. Revenue and Cost Analysis - The company’s revenue is influenced by factors such as total loss frequency, average vehicle auction selling price, and used car pricing[151]. - The company’s auction and auction-related service revenues are recognized at the time of auction based on fees charged, not the gross vehicle selling price[150]. - Yard operations expenses for fiscal 2024 increased by $192.1 million, or 12.7%, compared to fiscal 2023, with a significant increase in the U.S. of $148.2 million[167]. - Cost of vehicle sales for fiscal 2024 increased by $5.0 million, or 0.8%, compared to fiscal 2023, with a decrease of $13.3 million in the U.S. and an increase of $18.3 million internationally[169]. - General and administrative expenses increased by $84.8 million, or 33.9%, in fiscal 2024 compared to fiscal 2023, primarily due to a $80.3 million increase in the U.S. and a $4.5 million increase internationally[170]. Cash Flow and Liquidity - The company’s liquidity is primarily derived from cash operating results and revolving credit commitments under its credit agreement[153]. - Cash, cash equivalents, and restricted cash increased by $556.7 million to $1.5 billion as of July 31, 2024, primarily due to cash generated from operations and stock option exercises[176]. - Working capital rose by $1,019.8 million, or 36.8%, to $3.79 billion as of July 31, 2024, reflecting improved cash generation and timing of cash receipts[176]. - Operating cash flows increased by $108.4 million, or 7.9%, to $1.47 billion in fiscal 2024 compared to fiscal 2023, driven by higher service and vehicle sales revenues[176]. - Net cash used in investing activities decreased by $951.9 million, or 50.3%, in fiscal 2024 compared to fiscal 2023, primarily due to proceeds from the sale of held-to-maturity securities[182]. - The company plans to continue using cash flows from operations to finance working capital needs and business growth, with potential for additional cash through a Revolving Loan Facility or equity issuance[177]. - As of July 31, 2024, $180.5 million of the $1.5 billion in cash and equivalents was held by foreign subsidiaries, with no immediate plans for repatriation[180]. - The company did not repurchase any shares under its stock repurchase program in fiscal 2024, maintaining a total of 325,803,208 shares available for future repurchase[184]. - As of July 31, 2024, the company had $0.0 million outstanding borrowings under the Revolving Loan Facility, down from $11.0 million in the previous year[187]. Tax and Other Income - Total other income for fiscal 2024 rose by $74.8 million, or 110.4%, compared to fiscal 2023, mainly driven by higher interest income from U.S. Treasury Bills and gains on the sale of fixed assets[172]. - The effective income tax rate for fiscal 2024 was 20.5%, slightly up from 20.4% in fiscal 2023, influenced by tax adjustments and excess tax benefits from employee stock options[173]. Internal Controls and Compliance - The company's disclosure controls were effective at the reasonable assurance level as of July 31, 2024[211]. - Management assessed the effectiveness of internal control over financial reporting as of July 31, 2024, concluding that effective controls were maintained[213]. - Ernst & Young LLP issued an unqualified opinion on the company's internal control over financial reporting as of July 31, 2024[217]. - There were no changes in internal control over financial reporting during the quarter ended July 31, 2024, that materially affected the controls[214]. - The internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting[220]. - The company maintained effective internal control over financial reporting based on the COSO criteria[217]. - The evaluation of internal control effectiveness is subject to inherent limitations and may not prevent or detect misstatements[221]. Future Plans and Governance - The company plans to file a definitive proxy statement for the 2024 Annual Meeting of Stockholders within 120 days after the fiscal year-end[225]. - No directors or officers adopted or terminated any trading arrangements during the three months ended July 31, 2024[223].

Core Viewpoint - Copart, Inc. has experienced a decline in share price and is facing challenges due to high operating costs and increased capital expenditures, leading to a negative outlook for the near term [1][3][6]. Financial Performance - Shares of Copart have decreased by 10.3% over the past six months, slightly better than the Zacks Auction and Valuation Services industry's decline of 10.8% [1]. - In the fourth quarter of fiscal 2024, Copart reported adjusted earnings per share of 33 cents, which fell short of the Zacks Consensus Estimate of 37 cents [4]. - Fiscal 2024 capital expenditures reached $511 million, primarily focused on storage capacity expansion, which is expected to impact cash flows [3]. Cost Structure - Operating costs have been rising, with G&A expenses as a percentage of sales increasing to 9.1% in Q4 fiscal 2024 from 6.7% in the same period the previous year [3]. - The company anticipates continued increases in G&A expenses due to investments in sales, marketing, and technology, which may pressure near-term margins [3]. Market Sentiment - Technical indicators suggest that Copart's stock has been trading below the 50-day simple moving average since September 5, 2024, indicating a potential downtrend [4]. - EPS estimates for fiscal 2025 have declined by 6 cents over the past week, contributing to a negative outlook for the stock [6]. Investment Recommendations - Given the current challenges, the stock is rated as a Zacks Rank 5 (Strong Sell), suggesting that it may be prudent to avoid investing in Copart at this time [6].

Core Viewpoint - The average brokerage recommendation (ABR) for Copart, Inc. (CPRT) is 2.00, indicating a Buy, but reliance solely on this metric may not be prudent due to potential biases in brokerage recommendations [1][2]. Group 1: Brokerage Recommendations - Copart has an ABR of 2.00, with 50% of the eight recommendations being Strong Buy [1]. - Studies indicate that brokerage recommendations often show limited success in guiding investors towards stocks with the best price increase potential [2]. - Brokerage firms tend to exhibit a strong positive bias, issuing five Strong Buy recommendations for every Strong Sell [2][3]. Group 2: Zacks Rank vs. ABR - Zacks Rank is a proprietary stock rating tool that categorizes stocks from 1 (Strong Buy) to 5 (Strong Sell) based on earnings estimate revisions, differing from the ABR which is based solely on brokerage recommendations [4][5]. - The Zacks Rank is timely and reflects the latest earnings estimate revisions, while the ABR may not be up-to-date [6]. Group 3: Current Earnings Estimates for Copart - The Zacks Consensus Estimate for Copart has declined by 4.4% over the past month to $1.54, indicating growing pessimism among analysts regarding the company's earnings prospects [7]. - The decline in the consensus estimate has resulted in a Zacks Rank of 5 (Strong Sell) for Copart, suggesting caution despite the Buy-equivalent ABR [7].

mgkaya/E+ via Getty Images Introduction On June 5, I wrote an article titled "From Scrap To Riches - Copart Is An Amazing American Growth Story." Nonetheless, I gave the stock a Neutral rating. As the title suggests, in that article, I discussed the Copart's (NASDAQ:CPRT) fascinating business model, which has resulted in a total return of roughly 1,070% over the past ten years, making it one of the best-performing stocks I have discussed in recent years. Data by YCharts This performance includes its rec ...

Financial Data and Key Metrics Changes - In Q4 2024, global revenue increased to nearly $1.1 billion, representing growth of over $71 million or about 7% year-over-year [14] - For the fiscal year 2024, global revenue increased to more than $4.2 billion, representing growth of over $367 million or nearly 10% [14] - GAAP net income for Q4 decreased by over 7% to over $322 million or $0.33 per diluted common share, while for the fiscal year, GAAP net income increased by over 10% to over $1.4 billion [20] Business Line Data and Key Metrics Changes - Insurance business grew by 6% year-over-year, with total loss frequency increasing by 200 basis points [3][5] - Non-insurance sellers saw a volume growth of 20.4% year-over-year in Q4, while dealer sales volume increased by 9.5% year-over-year [9] - U.S. insurance unit volume increased by 6% year-over-year, while non-insurance unit volume growth outpaced insurance, with fleet rental and finance units increasing over 20% in Q4 [12][13] Market Data and Key Metrics Changes - The Manheim Used Vehicle Value Index declined by 8.6% year-over-year, while Copart's insurance selling prices significantly outpaced the broader used vehicle market [4] - International business unit growth was almost 17% in Q4 and 21% for the fiscal year 2024, with fee units increasing over 17% in Q4 [13] Company Strategy and Development Direction - The company is focused on deepening relationships with insurance clients through services like Title Express, which has gained substantial traction [6][7] - The strategy includes investing in organic product development and expanding the real estate portfolio to enhance operational capabilities [19][22] - The company aims to maintain a conservative capital structure, which is viewed as a competitive advantage in the industry [21] Management's Comments on Operating Environment and Future Outlook - Management noted that the 2024 storm season has been active, which has required significant resource mobilization [8] - The long-term trend of increasing vehicle complexity is expected to favor total loss over repairs, which is beneficial for the company's business model [4][5] - Management expressed confidence in the ongoing growth of the insurance business and the potential for increased activity in a lower interest rate environment [30] Other Important Information - Global average selling prices (ASPs) declined by approximately 5% for Q4 relative to the previous year, but U.S. ASPs showed resilience [14] - The company generated free cash flow of $962 million for the year, reflecting strong operating cash flow generation [22] Q&A Session Summary Question: Impact of financial model changes due to growth initiatives - Management acknowledged that while there are upfront investments for growth, the long-term unit economics should be favorable [25][26] Question: Update on Purple Wave's national expansion - Management indicated that Purple Wave is still in a transitional stage, expanding its geographic footprint [27][28] Question: Effect of lower interest rates on business model - Management speculated that lower interest rates could lead to increased business activity, benefiting intermediaries like Purple Wave [29] Question: Trends in accident frequency and its impact - Management noted that accident frequency has generally declined over the past 50 years, but total loss frequency has outpaced this trend [35][36] Question: Clarification on Title Express service - Management confirmed that Title Express allows insurance companies to alleviate internal costs and improve service levels [37][38] Question: Year-over-year comparison of catastrophic event-related vehicles - Management stated that the volume from catastrophic events was modest, with mobilizations not yielding significant unit volumes [54] Question: Yard operation expense growth drivers - Management explained that increased property taxes and non-recurring expenses contributed to the growth in yard operation costs [56][57] Question: Business mix and demographics of non-insurance customers - Management highlighted the importance of blue car volume and crossover buyers in driving liquidity and selling prices [59][60] Question: Historical framework for fee increases - Management emphasized a focus on delivering value to sellers and buyers, rather than discussing specific fee schedules [61]

Copart, Inc. (CPRT) came out with quarterly earnings of $0.33 per share, missing the Zacks Consensus Estimate of $0.37 per share. This compares to earnings of $0.34 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -10.81%. A quarter ago, it was expected that this company would post earnings of $0.38 per share when it actually produced earnings of $0.39, delivering a surprise of 2.63%.Over the last four quarters, the company has ...

Revenue and Income - Revenue for Q4 2024 increased by $71.4 million (7.2%) to $1.1 billion compared to the same period last year[1] - Revenue for the year ended July 31, 2024 increased by $367.3 million (9.5%) to $4.2 billion compared to the same period last year[2] - Net income for Q4 2024 decreased by $25.2 million (7.3%) to $323 million compared to the same period last year[1] - Net income for the year ended July 31, 2024 increased by $125.3 million (10.1%) to $1.4 billion compared to the same period last year[2] - Net income increased to $1,362,347 in 2024 from $1,237,741 in 2023, representing a growth of approximately 10.1%[10] Earnings Per Share - Fully diluted earnings per share for Q4 2024 decreased by 8.3% to $0.33 compared to $0.36 last year[1] - Fully diluted earnings per share for the year ended July 31, 2024 increased by 9.4% to $1.40 compared to $1.28 last year[2] Service and Vehicle Sales - Service revenues for Q4 2024 increased by 7.1% to $893.1 million compared to the same period last year[7] - Vehicle sales for Q4 2024 increased by 7.7% to $175.9 million compared to the same period last year[7] Operating Expenses - Total operating expenses for Q4 2024 increased by 16.9% to $709.5 million compared to the same period last year[7] Cash and Cash Equivalents - Cash, cash equivalents, and restricted cash increased to $1.5 billion as of July 31, 2024, compared to $957.4 million as of July 31, 2023[8] - Cash, cash equivalents, and restricted cash at the end of the period stood at $1,514,111 in 2024, up from $957,395 in 2023, an increase of 58.2%[10] Cash Flow - Net cash provided by operating activities rose to $1,472,564 in 2024 compared to $1,364,210 in 2023, an increase of about 7.9%[10] - Net cash used in investing activities decreased to $940,079 in 2024 from $1,892,049 in 2023, a reduction of 50.3%[10] Depreciation and Amortization - Depreciation and amortization expenses increased to $190,256 in 2024 from $159,684 in 2023, up by 19.1%[10] Property and Equipment - Purchases of property and equipment decreased slightly to $510,990 in 2024 from $516,636 in 2023, a reduction of 1.1%[10] Investments - Investment in held-to-maturity securities surged to $4,087,162 in 2024 from $1,406,588 in 2023, a significant increase of 190.6%[10] - Proceeds from the sale of held-to-maturity securities amounted to $3,645,000 in 2024, with no comparable figure in 2023[10] Taxes and Compensation - Income taxes paid, net of refunds, increased to $285,891 in 2024 from $257,514 in 2023, up by 11.0%[10] - Stock-based compensation decreased to $35,234 in 2024 from $39,673 in 2023, a reduction of 11.2%[10]

Company Performance - Copart, Inc. (CPRT) ended the latest trading session at $52.56, reflecting a -0.38% adjustment from the previous day's close, which lagged behind the S&P 500's 0.32% loss [1] - The company's stock has increased by 3.35% over the past month, outperforming the Business Services sector's gain of 0.64% and the S&P 500's gain of 1.52% [1] - The upcoming earnings release is expected to show an EPS of $0.37, representing an 8.82% increase compared to the same quarter last year, with projected revenue of $1.07 billion, reflecting a 7.4% rise from the equivalent quarter last year [1] Analyst Estimates - Recent adjustments to analyst estimates for Copart, Inc. indicate the dynamic nature of near-term business trends, with positive revisions suggesting optimism about the company's outlook [2] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a strong track record, with 1 stocks generating an average annual return of +25% since 1988; currently, Copart, Inc. holds a Zacks Rank of 3 (Hold) [2] Valuation and Industry Position - Copart, Inc. is trading at a Forward P/E ratio of 32.84, which aligns with the average Forward P/E of 32.84 for its industry [3] - The Auction and Valuation Services industry, part of the Business Services sector, has a Zacks Industry Rank of 102, placing it in the top 41% of over 250 industries [3] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1, highlighting the potential for growth within the industry [3]

Group 1 - Copart, Inc. (CPRT) ended the latest trading session at $51.59, reflecting a +0.55% change from the previous close, which was lower than the S&P 500's daily gain of 0.97% [1] - Over the past month, shares of Copart, Inc. have decreased by 0.77%, outperforming the Business Services sector's decline of 1.72% and the S&P 500's drop of 1.85% [1] - The upcoming earnings disclosure for Copart, Inc. is anticipated, with projected EPS of $0.37, indicating an 8.82% increase year-over-year, and net sales estimated at $1.07 billion, up 7.4% from the previous year [1] Group 2 - Recent changes to analyst estimates for Copart, Inc. are important for investors, as they reflect the evolving business trends and analysts' outlook on the company's health and profitability [2] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), indicates that Copart, Inc. currently holds a Zacks Rank of 3 (Hold) [2] - The Zacks Consensus EPS estimate for Copart, Inc. has remained unchanged over the past month [2] Group 3 - Copart, Inc. has a Forward P/E ratio of 31.94, which is consistent with the average Forward P/E for its industry [3] - The Auction and Valuation Services industry, part of the Business Services sector, holds a Zacks Industry Rank of 98, placing it in the top 39% of over 250 industries [3] - The Zacks Industry Rank evaluates the performance of industry groups, showing that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [3]

Group 1 - Copart, Inc. closed at $50.97, reflecting a +1.41% change, which was lower than the S&P 500's gain of 1.69% [1] - Over the past month, Copart's shares have decreased by 8.15%, while the Business Services sector and S&P 500 lost 3.4% and 4.78%, respectively [1] - The upcoming earnings report is expected to show an EPS of $0.37, representing an 8.82% increase year-over-year, with quarterly revenue projected at $1.07 billion, up 7.4% from the previous year [1] Group 2 - Recent adjustments to analyst estimates for Copart, Inc. can indicate changing business trends, with positive revisions seen as favorable for the company's outlook [2] - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has shown that stocks rated 1 have produced an average annual return of +25% since 1988 [2] - Currently, Copart, Inc. holds a Zacks Rank of 3 (Hold), with no changes in the Zacks Consensus EPS estimate over the past month [2] Group 3 - Copart, Inc. has a Forward P/E ratio of 31.28, which aligns with the industry average, suggesting no significant deviation in valuation [3] - The Auction and Valuation Services industry, part of the Business Services sector, has a Zacks Industry Rank of 96, placing it in the top 38% of over 250 industries [3] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1, highlighting the strength of the industry [3]