Copart, Inc. CFO NDR Takeaways: Cycle Recovery, International & Non-Insurance Momentum, RPU Initiatives, and BS Optionality Provide Growth Pathways Even as Share Trajectory Remains Unclear

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Copart, Inc. CFO NDR Takeaways: Cycle Recovery, International & Non-Insurance Momentum, RPU Initiatives, and BS Optionality Provide Growth Pathways Even as Share Trajectory Remains Unclear

ng rental car companies. Looking ahead,

international market expansion remains a top capital allocation priority to drive organic

growth, though the opportunity set appears relatively limited, as management is focused

on developed markets with gross settlement insurance practices and a car parc

comparable to the US. Management has identified a handful of markets in Western

Europe and developed-Asia that fit these criteria. While Australia meets most

requirements, CPRT pointed out that the right-hand drive configuration structurally

limits the buyer pool and ASP realization, as is the case in the UK. The entry strategy in

new markets is expected to mirror the historical approach, involving acquisitions of small

local dismantlers with existing insurance carrier relationships, and the preference

remains for the contractually sticky salvage insurance segment, especially given

continued strong demand from the international buyer base.

• Continued optimism around total loss frequency as CPRT drives ongoing industry

education. CPRT highlighted that a top-5 carrier and many smaller carriers are already

operating above 30% total loss frequency, compared to an industry-wide average of

~23.6% in 3Q, underscoring the broader industry’s lag in adopting a more flexible

approach to total losses than pure unit economics would suggest. Management views this

gap as a meaningful opportunity to expand overall industry volumes and lift total loss

frequencies by demonstrating the favorable economics insurance carriers can achieve

through a more data-driven and adaptable total loss strategy.