Growth has moderated from the peak years but the runway is very much intact.
International expansion is still early innings, total loss frequency is at all time highs, and the capex cycle in the US is maturing which means more free cash flow conversion going forward.
I expect double digit FCF per share growth to continue in the near term.
The best years for this business may still be ahead.
Thank you for reading and for the thoughtful question.
Looking at recent filings, most of what appears as insider selling at Copart is programmatic, sales executed under pre-scheduled 10b5-1 plans, often coinciding with option exercises. That is directors and executives diversifying personal wealth in an orderly way, I don’t see it as
a signal of lost conviction in the business.
The more meaningful insider signal, in my view, is what the company itself is doing. Copart has been deploying its cash pile to buy back its own shares, which tells something important, management believes the current share price understates the replacement value of the global yard network they have spent forty years building. You cannot buy 21,000 acres near major population centres at today’s prices. The stock, at current levels, may be offering exactly that.
I would be more concerned if they were selling shares and pulling back on land acquisition. That combination would tell a different story. For now, the company remains the most bullish insider in the room.
Are they still growing? From memory, forward growth is much lower than historical.
Thanks for reading and for the question.
Growth has moderated from the peak years but the runway is very much intact.
International expansion is still early innings, total loss frequency is at all time highs, and the capex cycle in the US is maturing which means more free cash flow conversion going forward.
I expect double digit FCF per share growth to continue in the near term.
The best years for this business may still be ahead.
Thank you for reading and for the thoughtful question.
Looking at recent filings, most of what appears as insider selling at Copart is programmatic, sales executed under pre-scheduled 10b5-1 plans, often coinciding with option exercises. That is directors and executives diversifying personal wealth in an orderly way, I don’t see it as
a signal of lost conviction in the business.
The more meaningful insider signal, in my view, is what the company itself is doing. Copart has been deploying its cash pile to buy back its own shares, which tells something important, management believes the current share price understates the replacement value of the global yard network they have spent forty years building. You cannot buy 21,000 acres near major population centres at today’s prices. The stock, at current levels, may be offering exactly that.
I would be more concerned if they were selling shares and pulling back on land acquisition. That combination would tell a different story. For now, the company remains the most bullish insider in the room.
Cheers