CPRTNASDAQThe short version
Copart, Inc.
Copart runs the larger of two online auctions U.S. insurers use to sell totaled and salvage vehicles, earning a fee on each sale; it is debt-free, founder-controlled and highly profitable, with shares down about 54% from their 2025 peak.
From a split-adjusted 15 cents at its 1994 debut to a $63.84 peak in May 2025, the shares have since fallen about 54% to $29.12 at the end of July 2026.
Mkt cap $28.5BP/E FY27E 17.3×
$29.12
Share price
$4.65B
FY2025 revenue
36.5%
Operating margin
23.1%
U.S. total-loss frequency
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Snapshot
Copart, Inc. in numbers
Price
$29.12as of 2026-07-31
Mkt cap
$28.5B
12m perf
−35.8%
3m ADV
$358.1M
| Year to Jul (USD) | 2023 | 2024 | 2025 | 2026E | 2027E | 2028E |
|---|---|---|---|---|---|---|
| Sales | – | – | – | 4.6B | 4.8B | 5.2B |
| EBITDA | 1.6B | 1.8B | 1.9B | 1.9B | 2.0B | 2.2B |
| EBIT | 1.5B | 1.6B | 1.7B | 1.7B | 1.8B | 1.9B |
| EBIT margin | – | – | – | 36.3% | 36.6% | 36.2% |
| EPS | 1.28 | 1.40 | 1.59 | 1.58 | 1.68 | 1.85 |
| P/E | 22.8× | 20.8× | 18.3× | 18.4× | 17.3× | 15.7× |
| FCF yield | 3.0% | 3.4% | 4.3% | 4.7% | 4.7% | 5.3% |
Consensus: S&P Capital IQ (CapIQ) · as of 2026-08-03Derived from run data; ratios use the latest price.
IThe business
The business
Copart earns a fee every time a totaled car changes hands
FY2025 revenue mix
Service fees85%85%
Vehicle sales15%15%
Fees on each auction, booked net — not the value of the car.
- A marketplace, not a dealer. Insurers and other sellers consign salvage and totaled vehicles; Copart runs the online auction and takes a fee on each sale, booking 85% of revenue as service fees.
- Insurers supply the cars. In FY2025 insurance companies provided 81% of the vehicles processed, feeding a near two-firm U.S. salvage market whose only listed rival is RB Global's IAA.
- Global by design. A virtual platform links roughly one million registered buyers across 185+ countries, so a wreck in Texas can draw bids from Poland or West Africa.
The moat, in a number
On nearly the same revenue, Copart earns twice its rival's profit
Copart vs RB Global, most recent fiscal year
| Metric | Copart | RB Global |
|---|---|---|
| Revenue | $4.65B | $4.28B |
| Operating margin | 36.5% | 17.8% |
| Operating income | $1.70B | $0.76B |
| Net interest | +$179M | −$234M |
RB Global owns IAA, Copart's nearest salvage rival.
- A 19-point gap. Copart's 36.5% operating margin is roughly double RB Global's 17.8% — and RB Global owns IAA, the number-two salvage platform, yet still cannot close it.
- Debt-free versus levered. Copart earns $179M of net interest income on its cash pile; RB Global pays $234M of interest on the debt from buying IAA.
- The gap is the moat. A well-funded competitor has spent years head-to-head and cannot match the unit economics — evidence the advantage is structural, not just execution.
Why the gap holds
Owned land and a million buyers are what a rival cannot copy
281
Owned & operated yards
~1M
Registered buyers, 185+ countries
$3.6B
Net property, owned not leased$1.9B → $3.6B since FY2020
- A physical barrier. Copart owns most of the land under its yards — scarce, permit-gated sites a new entrant would need years to assemble; net property has nearly doubled to $3.6B since FY2020.
- A network flywheel. More buyers lift the winning bid, so insurers recover more and route the next assignment to Copart — a loop a domestic-only rival struggles to seed.
- Soft where it is honest. Seller ties are relationships, not contracts; the lock-in is that Copart returns more per car, an edge it must re-earn every cycle.
IIThe record
The record
Revenue compounded about 15% a year — until it stalled
Revenue and operating income ($B)
Fiscal years end July 31.
- A decade compounder. Revenue rose from $2.7B in FY2021 to $4.65B in FY2025 and operating income from $1.1B to $1.7B — driven by rising total-loss volumes and higher fees per car.
- Then flat. Consensus models FY2026 revenue essentially unchanged as U.S. insurance unit volumes fell for three straight quarters — the stall behind the sell-off.
- Mix improving. Fee-based service revenue climbed to 85% of the total from 83%, so the asset-light core keeps taking share even as growth cools.
Margins
Margins eased from a pandemic peak but still sit near 36%
Operating margin (%)
- A gentle downshift. Operating margin slipped from a pandemic-era 42% to 36.5% as facility costs rose from 39% to 42% of revenue; FY2025 also carried $56M of one-time hurricane costs.
- Net margin held. Net margin actually rose to 33.4%, helped by interest on the cash pile and a lower tax rate — a marketplace's economics, not a dealer's.
- Still a franchise. A 36% operating margin on an asset-light platform is roughly double the nearest rival's — that margin gap, now expressed in the P&L over time.
Cash and capital
Debt-free with billions in cash, it finally began buying back stock
Operating cash flow vs buybacks ($M)
First repurchases since FY2019.
- A fortress balance sheet. No debt and about $4.2B of cash and Treasuries — a fifth of the market value — putting the odds of a solvency-driven loss near zero.
- The buyback turned on. After no repurchases from FY2020–FY2025, Copart bought back $1.6B of stock in nine months of FY2026 at $37.63, cutting the share count 4.3%.
- Founders own it. Willis Johnson and Jay Adair hold about $2.5B of stock; Adair draws a $1 salary and returns as CEO in mid-2026 — high skin in the game, low extraction.
IIIThe story now
What's happening now
The market halved the stock and cut the multiple from 40x to 18x
Split-adjusted close, 1994 to July 2026.
- A fallen star. From a $63.84 peak in May 2025 the shares have fallen about 54% to $29.12, near a 52-week low and the cheapest multiple in a decade.
- From 40x to 18x. At the peak Copart fetched roughly 40 times earnings; today it trades at 18.3 times, or about 15.5 times once its net cash is stripped out.
- Two triggers. Growth stalled on insurance volumes and margins softened — the market repriced a beloved compounder as a slower grower.
Key finding
Prices held revenue flat as volumes fell — on a bid Copart cannot control
U.S. insurance units, ex-catastrophe (YoY %)
Even as units fell, U.S. selling prices rose 4–8%, holding nine-month revenue roughly flat (−0.2%).
- Copart's U.S. ex-catastrophe insurance units fell 7.3%, then 4.8%, then 3.0% across fiscal 2026, yet nine-month revenue held roughly flat because average selling prices rose 4-8% — and that pricing offset rests on international buyers who set about half of U.S. auction value and pay a 38% premium, a demand pool exposed to tariffs, an unhedged dollar and import bans Copart does not control.
- The offset that held. The 4–8% price gains are what turned 3–7% unit declines into flat revenue; a sustained give-back would turn flat into falling, making 18x fair rather than cheap.
- Resilient so far. Through 2022–2026 tariff and dollar turbulence the international share of auction value grew and gross returns hit an all-time high — a gradual erosion is likelier than a sudden break.
Key finding
More wrecks are written off — the structural engine behind the volumes
U.S. total-loss frequency, recent quarters (%)
Seasonal quarter to quarter, but each year-over-year reading is higher; up from 15.6% in 2015.
- U.S. total-loss frequency has climbed from 15.6% of claims in 2015 to 23.1% in 2025, and the same perimeter-mounted safety sensors that gradually reduce accidents raise repair costs enough that rising total-loss frequency more than offsets the accident-frequency decline.
- The mechanism. Perimeter sensors both cut accidents and, when hit, make repairs so costly that more damaged cars cross the total-loss line and flow to auction — governing volumes on a ~290M-vehicle fleet.
- Directional, not guaranteed. The 10-K flags that accident-avoidance and eventual autonomy could reduce accidents, and a used-car spike suppressed total-loss frequency in 2021–22 before it recovered.
The open question
Cyclical pause or permanent step-down — the case turns on volume
The volume debate, both sides
| Question | Bull reads | Bear reads |
|---|---|---|
| Volume stall | Cyclical pullback, moderating each quarter | Two years, no dated end |
| Total-loss pool | Structural, still setting highs | Autonomy could cut accidents |
| Other engines | Non-insurance & int'l cushioned the fall | Too small to offset U.S. insurance |
- The cyclical read. Premium-squeezed drivers dropped collision coverage — insured car-years fell 4% while the fleet grew 1.4%; as rates ease, coverage tends to rebuild.
- The structural worry. The soft patch has run about two years with no dated end, and 'cyclical' is management's own label — a second down year would look structural.
- Diversifiers help, don't decide. Non-insurance (about a quarter of volume) and a higher-margin international arm softened the fall but cannot offset a sustained U.S. insurance decline.
IVThe price
What you pay
At 18x with net cash, the price embeds far less growth than delivered
Price / earnings: peak, now, ex-cash
The multiple embeds ~3–4% perpetual growth, against ~7% consensus and ~12.5% realized over three years.
- Cheap by its own history. Copart traded at 30–40 times for most of the past decade; today it is 18.3 times, about 15.5 times ex-cash and roughly 13.5 times operating profit.
- The embedded growth is low. At a 9% required return the price pays for only about 3.6% perpetual growth — below the ~7% the Street models and the ~12.5% net income compounded over three years.
- Not 'expensive' anymore. A 36%-margin, net-cash marketplace at a market multiple no longer fits the high-flyer label — cheap only if growth resumes, fair if the stall is permanent.
The scenarios
What today's price could become, on the exit multiple you assume
Implied price on FY2029 consensus EPS ($1.97)
Lower-growth (15x)
$29.50
Multiple held (18x)
$35.40
Partial re-rating (22x)
$43.20
Historical band (25x)
$49.10
Street mean target $40.30 sits between the middle scenarios; the lowest target, $26, is ~11% below today.
- Downside is bounded. About $4.54 a share is net cash and $3.89 is owned land — near 29% of the price before the auction franchise itself; the lowest Street target is only ~11% below today.
- Upside needs a re-rating. Holding FY2029 consensus EPS, a partial return toward the historical band reaches the mid-$40s, roughly the sell-side mean of $40.30.
- The hinge. The value case rests on the demand read being cyclical, not on the multiple alone — if volumes keep sliding, 18x is fair and the balance sheet, not the price, is the margin of safety.
What to watch
A debt-free, wide-moat compounder on sale — or a maturing business fairly priced for slower growth.
- 01Ex-catastrophe U.S. insurance units: crossing back to positive confirms a cyclical trough; a second negative fiscal year points structural.
- 02U.S. insurance selling prices versus the Manheim index, and the international share of auction value — the export bid holding or thinning.
- 03Total-loss frequency (CCC): still climbing, or stalling.
- 04Buyback pace and any dividend, sustained into fiscal 2027 — or a reversion to hoarding cash.
This distills a guided study of Copart, built chapter by chapter: what the business is, what it has done, what is happening now, and what the market asks you to pay.
Compiled from the full report · 2026-08-02 · For information, not investment advice.