# Karooooo (KARO.US)

Canonical: https://gigainvestors.com/s/KARO

Analysis as of: 2026-10-16T07:29:34.214Z. Financial observations: FY2019–FY2027.

Listing currency: USD. Reporting currency: ZAR.

## Verdict

A wonderful business at too high a price

Quality tests for Buy: pass (profit record: pass; earnings resilience is evidence only). Published buy qualification: no.

Share price: $62.54 per share; close as of 2026-10-15.

Estimated value: low $23.01 per share, central $25.92 per share, high $29.78 per share. Buy at or below the central value $25.92 per share. Valuation as of 2026-10-16T07:29:34.214Z; scenarios are not confidence intervals.

Expected annual return: 5.7% at the stated quote. About 5.7% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; US 10-year bond 5.1% + 4 points).

## Checklist

### understandable: pass

- 0 revenue declines in the last 10 years (informational)

- Financial history: 9 years

- Years with declining revenue: 0

- Years with a net loss: 0

- Operating margin variation: 0.10×

Chart: Operating margin; fiscal year observations.

- FY2019: 0.30×

- FY2020: 0.32×

- FY2021: 0.32×

- FY2022: 0.25×

- FY2023: 0.25×

- FY2024: 0.25×

- FY2025: 0.29×

- FY2026: 0.26×

- LTM to May 2026: 0.26×

### moat: pass

- ROIC, median of available years: 36.3%

- ROIC, second-lowest year: 33.6%

- Typical minus recent gross margin: 1.1 pp

- Typical gross margin (annual median): 69.0%

- Recent gross margin (lower of latest and 3-year median): 68.0%

- Years with nonpositive capital: 0

- Capital spending / revenue: 22.3%

- ROIC including acquisitions, ten-year median: 27.3%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2019: 47.8%

- FY2020: 63.4%

- FY2021: 68.9%

- FY2022: 34.3%

- FY2023: 36.4%

- FY2024: 29.3%

- FY2025: 36.3%

- FY2026: 33.6%

### economics: pass

- Owner earnings / net income, 5-yr: 0.83×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: ZAR 3.1B

- Net income, five-year total: ZAR 3.7B

- Return on incremental invested capital: 50.0%

- Working capital / revenue, annual change: -1.4 pp

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.00×

- FY2023: 1.00×

- FY2024: 1.00×

- FY2025: 0.89×

- FY2026: 0.46×

### management: pass

- buybacks leaned toward cheaper years (informational)

- ROIC first 3 years vs last 3 years: 63.4% vs 33.6%

- Per-share earnings: 13.46 to 29.81 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 5-year annual growth: 8.7%

- Diluted shares, 5-year annual growth: 8.7%

- Per-share value growth: 17.2%

- Per-share value change: ZAR 16.35

- Per-share value, starting three-year median: ZAR 13.46

- Per-share value, ending three-year median: ZAR 29.81

- Buybacks concentrated in cheaper years (correlation): 1.00

- Average buyback yield: 0.1%

- Buyback history: 2 years

- Debt-funded buybacks: No

- ROIC, first three-year median: 63.4%

- ROIC, last three-year median: 33.6%

Chart: Earnings per share; fiscal year observations.

- FY2019: ZAR 11.65

- FY2020: ZAR 13.46

- FY2021: ZAR 15.65

- FY2022: ZAR 15.24

- FY2023: ZAR 19.29

- FY2024: ZAR 23.85

- FY2025: ZAR 29.81

- FY2026: ZAR 32.17

### accounting: pass

- Sloan accruals: -13.9%

- Receivables to sales index (DSRI): 1.06×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 1.82×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.08×

Chart: Sloan accruals; fiscal year observations.

- FY2019: -16.6%

- FY2020: -33.8%

- FY2021: -21.5%

- FY2022: -16.6%

- FY2023: -14.2%

- FY2024: -5.5%

- FY2025: -20.6%

- FY2026: -13.9%

## Holders

- [David Hoeft](https://gigainvestors.com/DAC): tracked 13F investor; follow the investor page for holding quarter and amounts.

## Price story

Price needs cash profits to grow 12.6% a year for ten years · "Karooooo's 2026 Outlook: Global Fleet Expansion Drives Recurring Revenue Growth" (finance.yahoo.com, Sep 2026) · sales +5.2%

Story as of 2026-10-16T09:59:00.322Z; price observation 2026-10-15.

Price needs cash profits to grow 12.6% a year for ten years

### Sales · FY2026–2027

sales +5.2%; source https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm; observed 2026-06-09.

- FY2019: ZAR 1.7B 

- FY2020: ZAR 1.9B 

- FY2021: ZAR 2.3B 

- FY2022: ZAR 2.7B 

- FY2023: ZAR 3.5B 

- FY2024: ZAR 4.2B 

- FY2025: ZAR 4.6B 

- FY2026: ZAR 5.5B 

- FY2027: ZAR 5.8B 

### Gross margin · FY2026

gross margin 68%; source https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm; observed 2026-06-09.

- FY2019: 71.4% 

- FY2020: 70.4% 

- FY2021: 70.7% 

- FY2022: 66.4% 

- FY2023: 64.8% 

- FY2024: 64.0% 

- FY2025: 70.1% 

- FY2026: 68.0% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Operates in software application; annual sales are ZAR 5.5 billion.

- Source: https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm (filed 2026-06-09); FY2026: revenue 5479120000; grossProfit 3724170000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); KARO.US: Karooooo Ltd. provides software applications for fleet management, mobile asset tracking, workforce management, and video solutions in South Africa, the rest of Africa, Europe, the Asia-Pacific, the Middle East, and the United States. It operates through Cartrack, Carzuka, and Karooooo Logistics segments. The company offers Cartrack, a mobility SaaS cloud that provides systems integration, fleet management and administration, field worker management, video-based safety, risk mitigation and compliance, delivery management, and reporting solutions; and Karooooo Logistics, a software application for management of last-mile delivery and general operational logistics. It also provides physical and e-commerce vehicle buying and selling marketplace. The company serves consumers and sole proprietors, small and medium-sized businesses, and large enterprises. Karooooo Ltd. was founded in 2001 and is headquartered in Singapore.

### Why customers stay

Margins ranged from 64% to 70.1% during 2024–26; it earns 36.3% on its capital.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2024: grossProfit / revenue = 64%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2025: grossProfit / revenue = 70.1%.

- Source: https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm (filed 2026-06-09); FY2026: grossProfit / revenue = 68%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); 8-year return on capital observations [[2019,0.4784791366859492],[2020,0.6341848099974822],[2021,0.688764659926413],[2022,0.3431825324715632],[2023,0.3641805868097157],[2024,0.2926133532391445],[2025,0.362701154540506],[2026,0.33582815178854686]]; median 0.3634408706751109. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Revenue per user rose 3%.

- Source: https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm (filed 2026-06-09); [p0] Subscription Revenue Our track record of subscriber growth reflects the strength of our proprietary operational intelligence platform, ongoing innovation in software features and functionality, customer-focused sales organization and our competitive pricing model. We believe that our ability to attract a range of new customers and increase our subscriber base is key to our business model. We define our number of subscribers at the end of any particular period as the total number of connected vehicles and equipment using our platform at the end of such period. As at financial years ended February 28, 2026, and February 28, 2025, Cartrack had 2,662,222 and 2,302,236 subscribers, respectively, which represents net subscriber growth of 359,986 or a 16% increase from period to period. As at February 28, 2025, and February 29, 2024, Cartrack had 2,302,236 and 1,971,532 subscribers, respectively, which represents net subscriber growth of 330,704 or a 17% increase from period to period. As at February 28/29 Y-o-Y % 2026 2025 2024 (2) 2026 2025 Subscribers (as at end of period) 2,662,222 2,302,236 1,971,532 16 % 17 % Subscription revenue is a key metric we use to evaluate our business as we derive substantially all our revenue from Cartrack’s sale of subscriptions to its operational intelligence platform. For the financial years ended February 28, 2026, February 28, 2025 and February 29, 2024, Karooooo’s subscription revenue was ZAR 4,843.7 million, ZAR 4,068.2 million and ZAR 3,535.8 million, respectively, which represents a 19% and 15% increase, respectively, compared to the prior period. Cartrack’s subscription revenue increased 19% to ZAR 4,830.7 million for the financial year ended February 28, 2026, as compared to ZAR 4,055.4 million for the financial year ended February 28, 2025 driven primarily by subscriber growth. The

[p1] t in time, calculated by taking the monthly subscription revenue for all customers during that month and multiplying by 12. ARR is not adjusted for the impact of any known or projected future customer cancellations, service upgrades or downgrades or price increases or decreases. The amount of actual revenue that we recognize over any 12-month period is likely to differ from ARR at the beginning of that period, sometimes significantly. This may occur due to subsequent changes in our pricing, service cancellations, upgrades or downgrades and acquisitions or divestitures. Our calculation of ARR may differ from similarly titled metrics presented by other companies. The following table shows Cartrack’s ARR for each of the periods presented calculated using subscription revenue for the last month in each period: As at February 28/29 Y-o-Y % 2026 2026 2025 2024 (2) 2026 2025 (U.S.$ thousands (1)) (in R thousands) Annualized Recurring Revenue (a non-IFRS measure) 325,410 5,179,462 4,383,935 3,769,381 18 % 16 % (1) For convenience purposes only, amounts in South African rand as at February 28, 2026 have been translated to U.S. dollars using an exchange rate of ZAR 15.9167 to U.S.$1.00, the exchange rate for U.S. dollars as at February 28, 2026 as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. These translations should not be considered representations that any such amounts have been, could have been or could be converted at that or any other exchange rate. See “Exchange Rates” for further information about recent fluctuations in exchange rates. (2) We have elected to omit discussion of the earliest of the three years covered by our consolidated financial statements presented in this annual report because that disclosure as at and for the financial year ended February 29, 2024 

[p2] owngrades or price increases or decreases. The amount of actual revenue that we recognize over any 12-month period is likely to differ from ARR at the beginning of that period, sometimes significantly. This may occur due to subsequent changes in our pricing, service cancellations, upgrades or downgrades and acquisitions or divestitures. Our calculation of ARR may differ from similarly titled metrics presented by other companies. The following table shows Cartrack’s ARR for each of the periods presented calculated using subscription revenue for the last month in each period: As at February 28/29 Y-o-Y % 2026 2026 2025 2024 (2) 2026 2025 (U.S.$ thousands (1)) (in R thousands) Annualized Recurring Revenue (a non-IFRS measure) 325,410 5,179,462 4,383,935 3,769,381 18 % 16 % (1) For convenience purposes only, amounts in South African rand as at February 28, 2026 have been translated to U.S. dollars using an exchange rate of ZAR 15.9167 to U.S.$1.00, the exchange rate for U.S. dollars as at February 28, 2026 as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. These translations should not be considered representations that any such amounts have been, could have been or could be converted at that or any other exchange rate. See “Exchange Rates” for further information about recent fluctuations in exchange rates. (2) We have elected to omit discussion of the earliest of the three years covered by our consolidated financial statements presented in this annual report because that disclosure as at and for the financial year ended February 29, 2024 was included in our annual report on Form 20-F (File No. 001-40300), filed with the SEC on June 9, 2025, under the section titled “Item 5. Operating and Financial Review and Prospects.” For the financial years ended February 28, 2026 and

[p3]  was ZAR 4,383.9 million and ZAR 3,769.4 million, respectively, which represents a 16% increase from period to period. Average Revenue Per Subscriber (“ARPU”) (a non-IFRS measure) ARPU measures the monetization of our platform and is an indicator of pricing efficiency, competitiveness and market positioning. ARPU is calculated on a quarterly basis by dividing the cumulative subscription revenue for the quarter by the average of the opening subscriber balance at the beginning of the quarter and closing subscriber balance at the end of the quarter. The result is then divided by three to reflect monthly ARPU. On an annual basis, Cartrack’s ARPU is calculated as the average of the four quarterly ARPUs in that year. Cartrack’s ARPU has been fairly consistent since inception. Given our economies of scale and vertically integrated business model, the monthly ARPU of approximately ZAR 162. The following table shows our historical ARPU for each of the periods presented: As at February 28/29 Y-o-Y % 2026 2026 2025 2024 (2) 2026 2025 (U.S.$(1)) (in R’s) Average Revenue Per Subscriber (a non-IFRS measure) 10 162 158 160 3 % (1 )% (1) For convenience purposes only, amounts in South African rand as at February 28, 2026 have been translated to U.S. dollars using an exchange rate of ZAR 15.9167 to U.S.$1.00, the exchange rate for U.S. dollars as at February 28, 2026 as set forth in the H.10 statistical release of the Board of Governors of the Federal Reserve System. These translations should not be considered representations that any such amounts have been, could have been or could be converted at that or any other exchange rate. See “Exchange Rates” for further information about recent fluctuations in exchange rates. 

### Where the cash goes

Earns 50% on new investment; paid dividends in 8 of 8 years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2019: growth capex 0; upkeep 438016430; owner earnings 60424570. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2020: growth capex 95944000; upkeep 327024000; owner earnings 289882000. Growth capex / owner earnings = 0.33097605232473903.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2021: growth capex 77536000; upkeep 445749000; owner earnings 318183000. Growth capex / owner earnings = 0.24368366631781083.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2022: growth capex 3124508; upkeep 561925000; owner earnings 449953000. Growth capex / owner earnings = 0.006944076381310937.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2023: growth capex 16671000; upkeep 609638000; cash acquisitions 0; owner earnings 597153000. Growth capex plus acquisitions / owner earnings = 0.02791746838749868.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2024: growth capex 185605357; upkeep 707029000; cash acquisitions 5102000; owner earnings 738191000. Growth capex plus acquisitions / owner earnings = 0.2583441914084566.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); FY2025: growth capex 178439577.98841465; upkeep 864081513.0115854; cash acquisitions 0; owner earnings 819731486.9884146. Growth capex plus acquisitions / owner earnings = 0.21768052200114713.

- Source: https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm (filed 2026-06-09); FY2026: growth capex 466520978.6558089; upkeep 1339910131.344191; cash acquisitions 0; owner earnings 453609049.6558089. Growth capex plus acquisitions / owner earnings = 1.0284648840445254.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); Incremental return on capital 0.4996962446509438, from the economics test's unchanged annual inputs.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); Dividend observations: [[2019,154129384],[2020,92008000],[2021,418094000],[2022,331252000],[2023,331252000],[2024,508797758],[2025,624492308],[2026,694352000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 67.6% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-15); KARO.US SharesStats.PercentInsiders = 67.61200000000001 percentage points; cache date 2026-10-15.

### What the price says

The price assumes cash profits grow 12.6% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-06-09); Ten-year compound average after fade. Initial solved rate 0.1687260578579478. Price 62.54; FX 0.06064; discount 0.1; same standard ten-year fade to terminal 0.03.  Closing-price date 2026-10-15.

## Monthly share-price history (USD per share)

- 2021-04: $38.91 per share

- 2021-05: $36.96 per share

- 2021-06: $36.75 per share

- 2021-07: $37.96 per share

- 2021-08: $31.47 per share

- 2021-09: $29.52 per share

- 2021-10: $35.20 per share

- 2021-11: $33.00 per share

- 2021-12: $40.78 per share

- 2022-01: $35.29 per share

- 2022-02: $31.50 per share

- 2022-03: $29.65 per share

- 2022-04: $29.70 per share

- 2022-05: $25.20 per share

- 2022-06: $21.50 per share

- 2022-07: $26.80 per share

- 2022-08: $25.58 per share

- 2022-09: $23.79 per share

- 2022-10: $25.00 per share

- 2022-11: $25.49 per share

- 2022-12: $23.30 per share

- 2023-01: $25.30 per share

- 2023-02: $25.40 per share

- 2023-03: $23.20 per share

- 2023-04: $23.28 per share

- 2023-05: $22.42 per share

- 2023-06: $23.40 per share

- 2023-07: $25.25 per share

- 2023-08: $24.19 per share

- 2023-09: $19.91 per share

- 2023-10: $24.00 per share

- 2023-11: $25.00 per share

- 2023-12: $24.30 per share

- 2024-01: $24.55 per share

- 2024-02: $24.82 per share

- 2024-03: $25.06 per share

- 2024-04: $29.06 per share

- 2024-05: $28.74 per share

- 2024-06: $29.30 per share

- 2024-07: $38.98 per share

- 2024-08: $38.29 per share

- 2024-09: $39.63 per share

- 2024-10: $40.00 per share

- 2024-11: $44.80 per share

- 2024-12: $45.15 per share

- 2025-01: $46.16 per share

- 2025-02: $45.27 per share

- 2025-03: $42.54 per share

- 2025-04: $42.61 per share

- 2025-05: $55.50 per share

- 2025-06: $48.98 per share

- 2025-07: $45.72 per share

- 2025-08: $52.66 per share

- 2025-09: $57.12 per share

- 2025-10: $44.58 per share

- 2025-11: $45.03 per share

- 2025-12: $45.50 per share

- 2026-01: $50.05 per share

- 2026-02: $47.22 per share

- 2026-03: $49.84 per share

- 2026-04: $48.96 per share

- 2026-05: $47.70 per share

- 2026-06: $49.36 per share

- 2026-07: $64.24 per share

- 2026-08: $66.51 per share

- 2026-09: $60.00 per share

- 2026-10: $62.54 per share

## Annual estimated value (USD per share)

- FY2023: low $12.95 per share, central $14.50 per share, high $16.55 per share

- FY2024: low $15.49 per share, central $17.52 per share, high $20.23 per share

- FY2025: low $18.56 per share, central $20.86 per share, high $23.92 per share

- FY2026: low $22.09 per share, central $24.85 per share, high $28.52 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

[Original 20-F filing](https://www.sec.gov/Archives/edgar/data/1828102/000121390026066795/ea0293645-20f_karooooo.htm); period 2026-02-28, filed 2026-06-09.

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.