Copart (CPRT) Reports Bang-Up Q3 Beat as Collision Growth Drives Volumes - Jefferies

Jefferies analyst, Bret Jordan, seems to be warming to the Copart (NASDAQ: CPRT) story after a solid beat. PT increases to $53 (from $40) but Hold rating remains. CPRT reported a Q3 beat of $0.64 vs. our $0.52 est. and consensus of $0.54 as impressive unit expansion (+15.6% yr/yr) offset slightly lower ASP’s. We expect favorable market trends (rising miles driven and crash frequency) and recent contract wins to drive continued outsized volume expansion while pricing pressures (FX, scrap) appear to be abating.

CPRT posted Q3 volume growth of 15.6% yr/yr (NA of 16.4%, UK of 11.1%) while unit inventory expanded 20.7% yr/yr, suggesting further future sales gains. While volumes benefited from recent contract wins, underlying growth was significant as several industry drivers continue to trend favorably. Notably, as calendar Q1 miles driven expanded 4.2% yr/yr and ongoing lower yr/yr fuel prices (-17% yr/yr in March) point to ongoing favorable travel trends.Longer term, international opportunities are plentiful as well as expansion into Western Europe.

For an analyst ratings summary and ratings history on Copart click here. For more ratings news on Copart click here.

Shares of Copart closed at $48.13 yesterday.

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