3. Copart, Inc. (NASDAQ:CPRT)
Number of Hedge Fund Holders: 44
Copart, Inc. (NASDAQ:CPRT) is a Dallas, Texas-based technology leader in the vehicle auction industry. Copart, Inc. (NASDAQ:CPRT) utilizes its VB3 technology to connect over 750,000 buyers and sellers globally.
Chilton Investment Company closed its position in Copart, Inc. (NASDAQ:CPRT) during Q1 2022.
Copart, Inc. (NASDAQ:CPRT) posted strong Q3 FY22 results, with revenue and earnings outperforming the consensus estimates. The company recorded service revenue of $766.3 million, compared to $623.8 million last year. However, total operating expenses increased by 39.8% YoY, and net income declined from $286.8 million to $278.6 million.
Wedgewood Partners shared its insights on Copart, Inc. (NASDAQ:CPRT) in its Q2 2021 investor letter. Here’s what the firm said:
“We first purchased Copart in late 2019. In this review, we will reprint parts of our original commentary on the Company and offer our thoughts on how the Company performed throughout the pandemic.
Copart is the largest company in the automotive salvage and auction industry. The industry is a duopoly, with the Company commanding a +40% market share. Insurance Auto Auctions is the Company’s only competitor of size or scale. The Company generates about 80% of its revenue in the U.S. The other 20% is generated in international markets. The U.K. generates the lion’s share at 15%. The rest is spread out in newer markets that include Canada, Brazil, Ireland, Germany, Spain, the U.A.E., Bahrain, Finland, and Ireland. Copart owns the largest global buying network, which essentially matches global demand with local supply.
The demand for salvage autos is a mix of dismantlers and rebuilders of used and refurbished auto parts that serve the auto repair market, whereby salvaged parts are considerably cheaper than new or OEM parts. Demand for autos that are damaged but worthy of repair has become a staple of international demand, where repaired cars are not subject to onerous safety regulations. With the Company’s advent of nationwide and global online salvage bidding, additional demand for complete, drivable autos from used car dealers and individuals has become quite significant in the demand mix. Insurance companies processing totaled autos make up the bulk (+87%) of the supply of auctioned autos. Copart has long relationships with State Farm, Allstate, Nationwide, and Farmers. GEICO recently signed on, which could easily yield +130,000 autos per year in supply. Other supply parties include charities, banks, rental car companies, fleet operators, and auto dealers. Copart acts as an agent, earning fees from both buyers and sellers…(Click here to see the full text)”
At the end of Q1 2022, Copart, Inc. (NASDAQ:CPRT) was held by 44 hedge funds.
