49.85 USD
+3.9 (+8.49%)
49.85 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to KARO. KARO was compared to 277 industry peers in the Software industry. While KARO belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. KARO is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
- In the past year KARO was profitable.
- Each year in the past 5 years KARO has been profitable.
- Each year in the past 5 years KARO had a positive operating cash flow.
1.2 Ratios
- KARO has a better Return On Assets (19.60%) than 95.31% of its industry peers.
- KARO has a Return On Equity of 31.09%. This is amongst the best in the industry. KARO outperforms 92.42% of its industry peers.
- With an excellent Return On Invested Capital value of 27.00%, KARO belongs to the best of the industry, outperforming 95.67% of the companies in the same industry.
- KARO had an Average Return On Invested Capital over the past 3 years of 23.04%. This is significantly above the industry average of 10.78%.
- The 3 year average ROIC (23.04%) for KARO is below the current ROIC(27.00%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 19.6% | ||
| ROE | 31.09% | ||
| ROIC | 27% |
ROA(3y)17.06%
ROA(5y)15.33%
ROE(3y)25.38%
ROE(5y)26.85%
ROIC(3y)23.04%
ROIC(5y)22.35%
1.3 Margins
- The Profit Margin of KARO (19.91%) is better than 83.39% of its industry peers.
- In the last couple of years the Profit Margin of KARO has grown nicely.
- KARO's Operating Margin of 28.37% is amongst the best of the industry. KARO outperforms 91.70% of its industry peers.
- KARO's Operating Margin has declined in the last couple of years.
- With a Gross Margin value of 69.26%, KARO perfoms like the industry average, outperforming 51.62% of the companies in the same industry.
- KARO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 28.37% | ||
| PM (TTM) | 19.91% | ||
| GM | 69.26% |
OM growth 3Y4.12%
OM growth 5Y-2.36%
PM growth 3Y7.16%
PM growth 5Y6.2%
GM growth 3Y1.84%
GM growth 5Y-0.08%
2. Health
2.1 Basic Checks
- KARO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
- KARO has about the same amout of shares outstanding than it did 1 year ago.
- KARO has more shares outstanding than it did 5 years ago.
- Compared to 1 year ago, KARO has a worse debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 8.15 indicates that KARO is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 8.15, KARO belongs to the top of the industry, outperforming 85.92% of the companies in the same industry.
- A Debt/Equity ratio of 0.11 indicates that KARO is not too dependend on debt financing.
- The Debt to Equity ratio of KARO (0.11) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.11 | ||
| Debt/FCF | N/A | ||
| Altman-Z | 8.15 |
ROIC/WACC2.37
WACC11.38%
2.3 Liquidity
- A Current Ratio of 1.14 indicates that KARO should not have too much problems paying its short term obligations.
- The Current ratio of KARO (1.14) is worse than 68.95% of its industry peers.
- KARO has a Quick Ratio of 1.14. This is a normal value and indicates that KARO is financially healthy and should not expect problems in meeting its short term obligations.
- With a Quick ratio value of 1.14, KARO is not doing good in the industry: 68.23% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.14 | ||
| Quick Ratio | 1.14 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 17.13% over the past year.
- The Earnings Per Share has been growing by 15.86% on average over the past years. This is quite good.
- Looking at the last year, KARO shows a quite strong growth in Revenue. The Revenue has grown by 8.61% in the last year.
- The Revenue has been growing by 18.66% on average over the past years. This is quite good.
EPS 1Y (TTM)17.13%
EPS 3Y25.35%
EPS 5Y15.86%
EPS Q2Q%5.08%
Revenue 1Y (TTM)8.61%
Revenue growth 3Y18.48%
Revenue growth 5Y18.66%
Sales Q2Q%15.47%
3.2 Future
- Based on estimates for the next years, KARO will show a quite strong growth in Earnings Per Share. The EPS will grow by 14.19% on average per year.
- Based on estimates for the next years, KARO will show a quite strong growth in Revenue. The Revenue will grow by 12.62% on average per year.
EPS Next Y5.27%
EPS Next 2Y9.86%
EPS Next 3Y14.19%
EPS Next 5YN/A
Revenue Next Year19.78%
Revenue Next 2Y17.85%
Revenue Next 3Y17.18%
Revenue Next 5Y12.62%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
- Although the future Revenue growth is still strong, it is not able to hold up the even more excellent growth rate of the past years.
4. Valuation
4.1 Price/Earnings Ratio
- The Price/Earnings ratio is 23.85, which indicates a rather expensive current valuation of KARO.
- KARO's Price/Earnings ratio is a bit cheaper when compared to the industry. KARO is cheaper than 71.48% of the companies in the same industry.
- KARO's Price/Earnings ratio indicates a similar valuation than the S&P500 average which is at 27.30.
- Based on the Price/Forward Earnings ratio of 21.15, the valuation of KARO can be described as rather expensive.
- 73.65% of the companies in the same industry are more expensive than KARO, based on the Price/Forward Earnings ratio.
- KARO's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 24.32.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 23.85 | ||
| Fwd PE | 21.15 |
4.2 Price Multiples
- Based on the Enterprise Value to EBITDA ratio, KARO is valued cheaply inside the industry as 88.45% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | N/A | ||
| EV/EBITDA | 9.93 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- The excellent profitability rating of KARO may justify a higher PE ratio.
- KARO's earnings are expected to grow with 14.19% in the coming years. This may justify a more expensive valuation.
PEG (NY)4.52
PEG (5Y)1.5
EPS Next 2Y9.86%
EPS Next 3Y14.19%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 2.88%, KARO has a reasonable but not impressive dividend return.
- KARO's Dividend Yield is rather good when compared to the industry average which is at 0.52. KARO pays more dividend than 96.03% of the companies in the same industry.
- KARO's Dividend Yield is rather good when compared to the S&P500 average which is at 1.82.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.88% |
5.2 History
- KARO has paid a dividend for less than 5 years, so there is no long track record yet.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
DPN/A
EPS Next 2Y9.86%
EPS Next 3Y14.19%
KAROOOOO LTD / KARO FAQ
What is the fundamental rating for KARO stock?
ChartMill assigns a fundamental rating of 6 / 10 to KARO.
What is the valuation status for KARO stock?
ChartMill assigns a valuation rating of 4 / 10 to KAROOOOO LTD (KARO). This can be considered as Fairly Valued.
How profitable is KAROOOOO LTD (KARO) stock?
KAROOOOO LTD (KARO) has a profitability rating of 8 / 10.
What is the valuation of KAROOOOO LTD based on its PE and PB ratios?
The Price/Earnings (PE) ratio for KAROOOOO LTD (KARO) is 23.85 and the Price/Book (PB) ratio is 7.8.
What is the expected EPS growth for KAROOOOO LTD (KARO) stock?
The Earnings per Share (EPS) of KAROOOOO LTD (KARO) is expected to grow by 5.27% in the next year.