Overview

• Singapore-based digital operations firm reported Q3 adjusted EPS rose 11% yr/yr

• Subscription revenue grew 20% yr/yr, driven by increased Cartrack subscribers

• Company raised midpoint of FY26 revenue outlook, indicating growth acceleration

Outlook

• Cartrack's FY2026 subscription revenue expected between ZAR4,785 mln and ZAR4,900 mln

• Cartrack's FY2026 operating profit margin projected between 27% and 30%

• Karooooo's FY2026 adjusted EPS expected between ZAR32.50 and ZAR35.50

Result Drivers

• SUBSCRIBER GROWTH - Cartrack subscribers increased 16% to 2.57 mln, driving subscription revenue growth

• SUBSCRIPTION REVENUE - Subscription revenue rose 20% to ZAR1,239 mln, supported by increased subscriber base

• INVESTMENT IMPACT - Strategic investments in sales capacity and acquisitions weighed on short-term profitability

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the it services & consulting peer group is "buy"

• Wall Street's median 12-month price target for Karooooo Ltd is $60.00, about 34% above its January 20 closing price of $44.76

• The stock recently traded at 20 times the next 12-month earnings vs. a P/E of 26 three months ago

Press Release: ID:nJseU0001a

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)