Financial Comparison: Carvana (CVNA) and Copart (CPRT)

Carvana (NYSE: CVNA) and Copart (NASDAQ:CPRT) are both mid-cap cyclical consumer goods & services companies, but which is the better investment? We will compare the two businesses based on the strength of their earnings, profitability, risk, analyst recommendations, dividends, valuation and institutional ownership.

Earnings and Valuation

This table compares Carvana and Copart’s gross revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Carvana $365.14 million 7.72 -$93.11 million ($1.28) -16.59
Copart $1.45 billion 6.92 $394.22 million $1.28 33.86

Copart has higher revenue and earnings than Carvana. Carvana is trading at a lower price-to-earnings ratio than Copart, indicating that it is currently the more affordable of the two stocks.

Institutional & Insider Ownership

15.2% of Carvana shares are owned by institutional investors. Comparatively, 78.4% of Copart shares are owned by institutional investors. 16.4% of Copart shares are owned by insiders. Strong institutional ownership is an indication that large money managers, endowments and hedge funds believe a stock is poised for long-term growth.

Profitability

This table compares Carvana and Copart’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Carvana -11.81% -153.67% -19.89%
Copart 20.01% 29.96% 16.30%

Analyst Ratings

This is a breakdown of current ratings and target prices for Carvana and Copart, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Carvana 1 4 9 0 2.57
Copart 0 4 2 0 2.33

Carvana currently has a consensus price target of $20.21, suggesting a potential downside of 4.81%. Copart has a consensus price target of $42.25, suggesting a potential downside of 2.51%. Given Copart’s higher possible upside, analysts clearly believe Copart is more favorable than Carvana.

Summary

Copart beats Carvana on 10 of the 13 factors compared between the two stocks.

Carvana Company Profile

Carvana Co. is an e-commerce platform for buying used cars. On the Company’s platform, consumers can research and identify a vehicle, inspect it using its proprietary 360-degree vehicle imaging technology, obtain financing and warranty coverage, purchase the vehicle and schedule delivery or pick-up, all from their desktop or mobile devices. The Company’s transaction technologies and online platform transform a traditionally time consuming process by allowing customers to secure financing, complete a purchase and schedule delivery online.

Copart Company Profile

Copart, Inc. (Copart) is a provider of online auctions and vehicle remarketing services in the United States, Canada, the United Kingdom, the United Arab Emirates, Oman, Bahrain, Brazil, Ireland, Spain and India. The Company also provides vehicle remarketing services in Germany. The Company operates through two segments: United States and International. The Company provides vehicle sellers with a range of services to process and sell vehicles primarily over the Internet through its virtual bidding third generation Internet auction-style sales technology (VB3). The Company’s service offerings include Online Seller Access, Salvage Estimation Services, Estimating Services, End-Of-Life Vehicle Processing, Virtual Insured Exchange (VIX), Transportation Services, Vehicle Inspection Stations, On-Demand Reporting, Department of Motor Vehicle (DMV) Processing, Flexible Vehicle Processing Programs, Buy It Now, Member Network, Sales Process, Copart Dealer Services, CashForCars.com and U-Pull-It.

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