No. of Recommendations: 2
Repurchases: Copart repurchases large chunks of its common stock when undervalued. Its solid balance sheet is now becoming that much more valuable, as the stock price has dropped 40% since its peak in May 2025. Copart repurchased $218 million of shares in the quarter ended January 31, 2026, after not having repurchased much since a sizable stock downdraft in 2018-2019.
Upon further inspection of the 10-Q for fiscal Q2, I found a couple of additional tidbits among the notes to the financial statements:
Note 6: ...The Company repurchased 5,480,191 shares of its common stock during the six months ended January 31, 2026 at a weighted average price of $39.82 per share totaling $218.2 million [this actually all occurred during the three months ended January 31]....As of January 31, 2026,...320 million shares were available for repurchase under the program.
Note 11: Subsequent to the end of the second quarter ended January 31, 2026, through March 2, 2026, the Company repurchased 24,262,025 shares of its common stock at a weighted average price of $37.11 per share totaling $898.7 million.
So, after not having made any significant repurchases in 6 years, the company has in the last 4 months repurchased 29.7 million shares (roughly 3% of the October 31 diluted shares outstanding) at an average price of $37.55, within spitting distance of the $37.74 March 6 closing price. The company now has about $4.1 billion in cash with which it could consider repurchasing more of the roughly 296 million shares available for repurchase under its authorized repurchase program. Given that Copart CEO Jeffrey Liaw worked at TPG Capital Management for more than 7 years (August 2005 to December 2012) and was a key decision-maker in TPG’s investment process, specifically within the firm's private equity operations, I would expect him to know a good investment and act on it decisively if the opportunity arose.
