The 10-second takeaway
For the quarter ended Jan. 31 (Q2), Copart beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue expanded, and GAAP earnings per share expanded significantly.
Gross margins expanded, operating margins increased, and net margins dropped.
Copart booked revenue of $227.9 million. The eight analysts polled by S&P Capital IQ expected a top line of $218.5 million on the same basis. GAAP reported sales were 9.9% higher than the prior-year quarter's $207.4 million.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
Non-GAAP EPS came in at $0.70. The eight earnings estimates compiled by S&P Capital IQ forecast $0.59 per share on the same basis. GAAP EPS of $0.62 for Q2 were 35% higher than the prior-year quarter's $0.46 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 43.7%, 230 basis points better than the prior-year quarter. Operating margin was 31.7%, 270 basis points better than the prior-year quarter. Net margin was 17.8%, 50 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $255.6 million. On the bottom line, the average EPS estimate is $0.87.
Next year's average estimate for revenue is $937.4 million. The average EPS estimate is $2.83.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 1,344 members rating the stock outperform and 41 members rating it underperform. Among 466 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 457 give Copart a green thumbs-up, and nine give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Copart is hold, with an average price target of $47.57.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. Motley Fool newsletter services have recommended buying shares of Copart. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.