Using an unlevered Free Cash Flow to Firm (FCFF) model, we project Copart, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from -0.7% to 14.6% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 66, DPO 34, DIO 9). At a 8.9% WACC with mid-year discounting, the terminal value (85% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 16.1x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $44.93 per share, suggesting CPRT is undervalued by 35.7% at the current price of $33.12.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 1,785 | 1,864 | 1,991 | 2,282 | 2,615 | 2,681 |
| (−) Net Interest | 11 | 12 | 13 | 14 | 17 | 17 |
| (+) D&A | 479 | 506 | 563 | 592 | 642 | 658 |
| EBITDA | 2,275 | 2,382 | 2,566 | 2,888 | 3,274 | 3,356 |
| (−) Tax | 337 | 352 | 376 | 431 | 494 | — |
| (−) CapEx | 595 | 621 | 664 | 761 | 872 | — |
| (−) ΔWC | 75 | 30 | 47 | 108 | 124 | — |
| Free Cash Flow (FCF) | 1,268 | 1,379 | 1,479 | 1,588 | 1,784 | — |
| Peers' EBITDA Multiple | 16.1x | |||||
| Terminal Value | 53,994 | |||||
| WACC / Discount Rate | 8.91% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 1,215 | 1,213 | 1,195 | 1,178 | 1,215 | 35,240 |
| Enterprise Value | 41,256 | |||||
| Projection Period | 6,016 | 14.6% | ||||
| Terminal Value | 35,240 | 85.4% | ||||
| (−) Current Net Debt | (2,677) | |||||
| Equity Value | 43,932 | |||||
| (÷) Outstanding Shares | 978M | |||||
| Fair Price | $45 | +35.7% | ||||
| WACC \ EV/EBITDA Exit Multiple | 12.1x | 14.1x | 16.1x | 18.1x | 20.1x |
|---|---|---|---|---|---|
| 6.9% | $39 | $44 | $49 | $54 | $59 |
| 7.9% | $37 | $42 | $47 | $51 | $56 |
| 8.9% | $36 | $40 | $45 | $49 | $54 |
| 9.9% | $35 | $39 | $43 | $47 | $52 |
| 10.9% | $33 | $37 | $42 | $46 | $50 |
Current price: $33.12. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.