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Copart (CPRT) Tops on Q2 Earnings & Revenues, Improves Y/Y

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Copart, Inc. (CPRT - Free Report) reported adjusted earnings per share of 47 cents in second-quarter fiscal 2018 (ended Jan 31, 2018), beating the Zacks Consensus Estimate of 38 cents. The bottom line improved 62% from 29 cents recorded in the year-ago quarter.

Net income was $103.3 million, reflecting a surge of 56.3% or $37.2 million from the second-quarter fiscal 2017.

Copart’s revenues rose 31.3% to $459.1 million from the year-ago quarter and surpassed the Zacks Consensus Estimate of $434.6 million. Service revenues went up 30% year over year to $402 million, while revenues from vehicle sales gained 45% to $57.2 million in comparison to the prior-year quarter.

Copart, Inc. Price, Consensus and EPS Surprise

Gross margin improved 30.6% to $191.6 million in the reported quarter from $147 million a year ago. Total operating expenses also increased to $308.2 million from $240.7 million recorded in the prior-year period. This rise in expense is primarily due to increased equipment-lease expenses and labor costs as a result of Hurricane Harvey.

Operating income increased to $151 million from $109 million a year ago.

Financial Details

Copart had cash and cash equivalents of $195.3 million as of Jan 31, 2018, compared with $210 million as of Jul 31, 2017. Long-term debt, revolving loan facility and capital lease obligations were $400.6 million as of Jan 31, 2017, which recorded a decline from $550.8 million as of Jul 31, 2017.

In second-quarter fiscal 2018, Copart generated net cash flow of $186 million from operations compared with $156 million a year ago.

Zacks Rank & Other Key Picks

Copart sports a Zacks Rank #2 (Buy). A few other top-ranked stocks in the auto space are Genuine Parts Co. (GPC - Free Report) , Volkswagen AG and AB Volvo (VLVLY - Free Report) , each carrying a Zacks Rank of 2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Genuine Parts has an expected long-term growth rate of 6.6%. In the last six months, shares of the company have gained 14.3%.

Volkswagen has an expected long-term growth rate of 18.7%. In the last six months, shares of the company have gained 32.8%.

Volvo has an expected long-term growth rate of 15%. Over a year, shares of the company have gained 47.8%.

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