Update shared on27 Aug 2025
Fair value Increased 4.03%Karooooo’s consensus price target has increased to $60.54, reflecting stronger revenue forecasts and analyst confidence in its vertically integrated telematics model and exceptional customer retention.
Analyst Commentary
- Bullish analysts highlight Karooooo’s vertically integrated telematics model, which spans installation to post-sale servicing, resulting in high customer satisfaction and market share expansion.
- Customer retention is cited as a strong driver, with a 95% commercial retention rate seen as evidence of operational excellence and product value.
- Proactive control over the entire customer lifecycle supports differentiation from competitors in the telematics sector.
- Upward revisions of FY26 and FY27 revenue forecasts (+4% and +12% respectively) reflect improved business fundamentals ahead of Q1 results.
- A stronger forex translation has contributed to higher U.S. dollar price targets, boosting the company’s perceived value for international investors.
What's in the News
- Announced an interim dividend of USD1.25 per ordinary share for Q1 FY2026.
- Reaffirmed FY2026 guidance: Cartrack subscription revenue ZAR 4,700–4,900 million (16–21% growth), operating profit margin 26–31%, EPS ZAR 32.50–35.50.
- Expressed interest in strategic M&A to accelerate market entry, expand products, or strengthen market position, while maintaining a high threshold for acquisition criteria.
- Completed a $75 million follow-on equity offering of 1,500,000 ordinary shares at $50 per share ($2.5 discount per share); shares subject to 90-day lock-up for key stakeholders.
- No further shares repurchased after buyback of 57,806 shares ($27.27 million, 0.19% of shares) completed under May 2024 program.
Valuation Changes
Summary of Valuation Changes for Karooooo
- The Consensus Analyst Price Target has risen slightly from $58.10 to $60.54.
- The Future P/E for Karooooo has significantly fallen from 28.76x to 1.52x.
- The Net Profit Margin for Karooooo has significantly risen from 17.58% to 20.17%.
Disclaimer
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