Copart, Inc. (NASDAQ:CPRT) Capital Efficiency Analysis

Copart (NASDAQ:CPRT) shares fell more than 11% intra-day today after the company reported fiscal Q3 results that met earnings expectations but missed on revenue, dampening investor sentiment despite continued year-over-year growth.

The online vehicle auction platform posted EPS of $0.42 for the quarter, in line with analyst forecasts. Revenue came in at $1.21 billion, slightly below the $1.23 billion consensus estimate. Still, revenue rose 7.5% year-over-year, while net income increased 6.4% to $406.6 million.

Service revenues, which make up the bulk of Copart’s business, climbed 9.3% to $1.03 billion. However, vehicle sales fell 2.1% to $176.9 million, contributing to the top-line shortfall.

For the first nine months of fiscal 2025, Copart posted revenue of $3.52 billion—up 11.2% year-over-year—while net income rose 11.1% to $1.16 billion, underscoring solid underlying business momentum.

While profit growth remains steady, the modest Q3 revenue miss appears to have cooled investor enthusiasm in the near term.

Copart, Inc. (NASDAQ:CPRT) is a global leader in online vehicle auctions, providing services to process and sell salvage and clean title vehicles. The company operates in a competitive landscape with peers like Verisk Analytics, ANSYS, Cintas Corporation, CDW Corporation, and Old Dominion Freight Line. These companies, while not direct competitors in the vehicle auction space, are compared based on financial metrics like ROIC and WACC to assess capital efficiency.

Copart's ROIC of 16.34% is notably higher than its WACC of 10.31%, resulting in a ROIC to WACC ratio of 1.58. This indicates that Copart is effectively using its capital to generate returns that exceed its cost of capital. For investors, this is a positive indicator of the company's ability to create value from its investments.

In comparison, Verisk Analytics boasts a ROIC of 25.62% and a WACC of 7.79%, leading to a ROIC to WACC ratio of 3.29. This suggests that Verisk is highly efficient in its capital utilization, generating returns significantly above its cost of capital. This efficiency makes Verisk an attractive option for investors seeking high capital returns.

Old Dominion Freight Line also shows strong capital efficiency with a ROIC of 28.54% and a WACC of 8.77%, resulting in a ROIC to WACC ratio of 3.26. This places it among the top performers in terms of capital utilization, similar to Verisk Analytics, and highlights its ability to generate substantial returns on invested capital.

While Copart's ROIC to WACC ratio is commendable, it is surpassed by Verisk Analytics and Old Dominion Freight Line. These comparisons provide valuable insights for investors evaluating potential investments, emphasizing the importance of capital efficiency in generating shareholder value.

Copart, Inc. (NASDAQ:CPRT) is a global leader in online vehicle auctions, providing services to process and sell salvage and clean title vehicles. The company operates in a competitive landscape with peers like Verisk Analytics, ANSYS, Cintas Corporation, CDW Corporation, and Old Dominion Freight Line. These companies, while diverse in their operations, are compared based on financial metrics like ROIC and WACC to assess efficiency in capital utilization.

Copart's ROIC of 16.34% surpasses its WACC of 10.07%, resulting in a ROIC to WACC ratio of 1.62. This indicates that Copart is generating returns above its cost of capital, which is a positive sign for investors. In comparison, Verisk Analytics boasts a higher ROIC of 25.62% and a lower WACC of 7.58%, leading to a superior ROIC to WACC ratio of 3.38, suggesting more efficient capital use.

ANSYS, with a ROIC of 8.19% and a WACC of 9.01%, has a ROIC to WACC ratio of 0.91, indicating that its returns do not cover its cost of capital. This contrasts with Cintas Corporation, which has a ROIC of 25.74% and a WACC of 9.86%, resulting in a strong ROIC to WACC ratio of 2.61, reflecting effective capital management.

CDW Corporation's ROIC of 15.54% against a WACC of 7.83% yields a ROIC to WACC ratio of 1.99, showing efficient capital utilization. However, Old Dominion Freight Line leads with a ROIC of 30.29% and a WACC of 8.54%, achieving the highest ROIC to WACC ratio of 3.55 among the peers, highlighting its superior capital allocation strategy.

Copart, Inc. (NASDAQ:CPRT) is a global leader in online vehicle auctions, providing services to process and sell salvage and clean title vehicles. The company operates in a competitive landscape with peers like Verisk Analytics, ANSYS, Cintas Corporation, CDW Corporation, and Old Dominion Freight Line. These companies, while diverse in their operations, are compared based on financial metrics like ROIC and WACC to assess efficiency in capital utilization.

Copart's ROIC of 16.34% surpasses its WACC of 10.07%, resulting in a ROIC to WACC ratio of 1.62. This indicates that Copart is generating returns above its cost of capital, which is a positive sign for investors. In comparison, Verisk Analytics boasts a higher ROIC of 25.62% and a lower WACC of 7.58%, leading to a superior ROIC to WACC ratio of 3.38, suggesting more efficient capital use.

ANSYS, with a ROIC of 8.19% and a WACC of 9.01%, has a ROIC to WACC ratio of 0.91, indicating that its returns do not cover its cost of capital. This contrasts with Cintas Corporation, which has a ROIC of 25.74% and a WACC of 9.86%, resulting in a strong ROIC to WACC ratio of 2.61, reflecting effective capital management.

CDW Corporation's ROIC of 15.54% against a WACC of 7.83% yields a ROIC to WACC ratio of 1.99, showing efficient capital utilization. However, Old Dominion Freight Line leads with a ROIC of 30.29% and a WACC of 8.54%, achieving the highest ROIC to WACC ratio of 3.55 among the peers, highlighting its superior capital allocation strategy.

In the competitive landscape of online auctions and vehicle remarketing services, Copart, Inc. (NASDAQ:CPRT) stands as a significant player. The company's operations, focusing on providing a platform for processing and selling vehicles via the internet, place it in a unique position within its industry. This sector is characterized by its reliance on technological advancements and the efficiency of service delivery, making the comparison of financial metrics like ROIC and WACC particularly relevant for investors seeking to understand Copart's financial health and operational efficiency.

The ROIC, or Return on Invested Capital, measures how well a company generates returns from its invested capital. Copart's ROIC of 16.34% is a testament to its ability to use its capital effectively to generate profits. On the other hand, the WACC, or Weighted Average Cost of Capital, represents the average rate that a company is expected to pay to finance its assets. With a WACC of 9.72%, Copart's cost of financing is lower than its returns on investments, indicating a positive spread and a financially healthy operation.

When comparing Copart to its peers, such as Verisk Analytics, ANSYS, Cintas Corporation, CDW Corporation, and Old Dominion Freight Line, it's clear that the industry is diverse, spanning from data analytics to IT solutions and corporate uniforms. Each company has its unique WACC and ROIC, reflecting different levels of operational efficiency and capital allocation strategies. For instance, Old Dominion Freight Line, with the highest ROIC to WACC ratio of 3.73, showcases exceptional efficiency in generating returns on its investments compared to its cost of capital.

Despite Copart's strong performance, with a ROIC/WACC ratio of 1.68, it trails behind Old Dominion Freight Line, indicating room for improvement in capital utilization and operational efficiency. This comparison not only highlights Copart's position within its competitive set but also underscores the importance of these financial metrics in evaluating a company's performance and potential for growth.

Investors analyzing companies like Copart and its peers must consider these ratios to gauge how effectively a company is using its capital to generate returns. A higher ROIC compared to WACC is generally seen as a positive indicator, suggesting that the company is in a good position to grow and deliver value to its shareholders. Through this lens, Copart's financial metrics reveal a company that is performing well, yet with opportunities to enhance its capital efficiency further.

In the competitive landscape of online auctions and vehicle remarketing services, Copart, Inc. (NASDAQ:CPRT) stands as a significant player. The company's operations, focusing on providing a platform for processing and selling vehicles via the internet, place it in a unique position within its industry. This sector is characterized by its reliance on technological advancements and the efficiency of service delivery, making the comparison of financial metrics like ROIC and WACC particularly relevant for investors seeking to understand Copart's financial health and operational efficiency.

The ROIC, or Return on Invested Capital, measures how well a company generates returns from its invested capital. Copart's ROIC of 16.34% is a testament to its ability to use its capital effectively to generate profits. On the other hand, the WACC, or Weighted Average Cost of Capital, represents the average rate that a company is expected to pay to finance its assets. With a WACC of 9.72%, Copart's cost of financing is lower than its returns on investments, indicating a positive spread and a financially healthy operation.

When comparing Copart to its peers, such as Verisk Analytics, ANSYS, Cintas Corporation, CDW Corporation, and Old Dominion Freight Line, it's clear that the industry is diverse, spanning from data analytics to IT solutions and corporate uniforms. Each company has its unique WACC and ROIC, reflecting different levels of operational efficiency and capital allocation strategies. For instance, Old Dominion Freight Line, with the highest ROIC to WACC ratio of 3.73, showcases exceptional efficiency in generating returns on its investments compared to its cost of capital.

Despite Copart's strong performance, with a ROIC/WACC ratio of 1.68, it trails behind Old Dominion Freight Line, indicating room for improvement in capital utilization and operational efficiency. This comparison not only highlights Copart's position within its competitive set but also underscores the importance of these financial metrics in evaluating a company's performance and potential for growth.

Investors analyzing companies like Copart and its peers must consider these ratios to gauge how effectively a company is using its capital to generate returns. A higher ROIC compared to WACC is generally seen as a positive indicator, suggesting that the company is in a good position to grow and deliver value to its shareholders. Through this lens, Copart's financial metrics reveal a company that is performing well, yet with opportunities to enhance its capital efficiency further.