Earnings Preview: Copart

Copart Inc (CPRT - Snapshot Report) is scheduled to announce its fourth quarter and fiscal 2011 results on September 21, 2011, after the market closes. Currently, the Zacks Consensus Estimate for the fourth quarter and fiscal year 2011 is 59 cents and $2.18 per share, respectively. The sales estimate is around $210 million and $867 million, for the same periods.

Third Quarter Overview

Copart, a provider of online auctions and vehicle remarketing services, reported net income of $50.1 million in the third quarter ended 30 April 2011, up 12.9% from $44.4 million in the same quarter of 2010.

Earnings per share spiked 36.5% to 71 cents compared with 52 cents per share a year earlier, outshining the Zacks Consensus Estimate of 70 cents by 1.43%.

Copart's revenue was $236.8 million, an increase of 7.4% from $220.3 million in the third quarter of 2010.

Additionally, Copart repurchased 1,441,542 shares of its common stock during the third quarter at a weighted average price of $43.03 per share. At the end of the quarter, the company had 11,537,912 shares available for repurchase under its share repurchase program.

On August 31, 2011, Copart announced that it will open a 77-acre vehicle storage facility in Ellenwood, to improve service in metro Atlanta. Atlanta is a major market, and the new South Atlanta facility in Ellenwood is expected to provide additional capacity to more efficiently cover the region as demand for the services grows.

Agreement with Analysts 

Although the analysts projected strong earnings in the third quarter, we do not see any fluctuations in analyst estimates for the upcoming quarters and the fiscal years over the past 30 days or 7 days. We, therefore, maintain a neutral sentiment on the stock.

No change in estimates point to the fact that there was no major catalyst during the quarter to drive results.

Magnitude of Estimate Revisions

There was no change in estimates trend for the upcoming quarters and the fiscal years over the past 30 days or 7 days. The first and the second quarter of 2012 remained unchanged at 59 and 57 cents per share, respectively, while the fiscal 2012 and 2013 remained unaffected at $2.18 and $2.55 per share, respectively.

Founded in 1982 and headquartered in Fairfield, California, Copart provides online auctions and vehicle remarketing services in the United States, Canada, and the United Kingdom. It offers a range of services for processing and selling vehicles over the Internet, through its virtual bidding second generation Internet auction-style sales technology, to vehicle sellers, primarily insurance companies, banks and financial institutions, charities, car dealerships, fleet operators, vehicle rental companies, and the general public.

Read the full analyst report on CPRT