Karooooo Ltd Dossier - Source-backed chat

Karooooo Ltd

KARONASDAQ

SectorInformation Technology

IndustrySoftware - Application

Beta (adjusted)0.93

Intrinsic Value $71.80median of 6 methods · middle span $2-$179based on filings through 28 Feb 2025

Market Price $60.76Price as of 1 Oct 2026

UndervaluedIntrinsic value is 18% above the market price

−50% · IV below pricenear fair value ±15%IV above price · +50%

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Market Cap $1.9B

Enterprise Value $1.3B

Shares Outstanding 30.9M diluted

Next Earnings Date13 Oct 2026

Last ex-dividend17 Jul 2026

All prices and values are periodic snapshots, not live quotes. Source dates are shown for reference.

Thesis

Street consensus, scenarios, merits, risks, and invalidation triggers

AI-assisted

Thesis Summary

Karooooo Ltd. (NASDAQ: KARO) represents a highly profitable, vertically integrated global mobility SaaS platform. Unlike many high-growth peers that burn cash, Karooooo consistently generates strong operating margins (~26%) and robust free cash flow, supported by a 95% customer ARR retention rate. Its core South African market remains highly resilient, while its expansion into Southeast Asia (ASEAN) serves as a powerful long-term growth engine.

This section is the 12-month view: analyst targets and the probability-weighted scenarios built from them. The intrinsic value at the top of this page answers a different question: what the business is worth today.

Street view · analyst 12-month targets5 analysts · as of 18 Aug 2026

Low · most bearish analyst$65.98

Mean target$74.67

High · most bullish analyst$81.13

Our research · scenarios, merits, risks, and invalidation triggersResearch as of 18 Sep 2026

Scenarios · 12-month scenario targetsAnchored at research date

Bear CaseDownside scenario

$65.9820%

Intensified competition from low-cost hardware vendors in APAC and Africa leads to pricing degradation, dragging subscription growth below 15%. Margin contraction accelerates due to rising device costs and foreign exchange headwinds, leading to multiple compression.

Base CaseCentral scenario

$74.6750%

Matches the consensus mean

Cartrack subscription revenue grows within the guided range of 18% to 24% for FY 2027, and EPS expands by ~21% to ZAR 38.5 - 40.0. Southeast Asia continues to grow at >20% YoY, offsetting minor gross margin pressures from hardware and localized investments.

Bull CaseUpside scenario

$81.1330%

Accelerated adoption of AI-driven video telematics (LiveVision) and rapid scaling in Southeast Asia drive subscription revenue growth above 24% in FY 2027. Operating margins expand as fixed-cost absorption improves, and Karooooo Logistics achieves profitability sooner than expected.

Scenarios are anchored to street consensus at the research date, with our probabilities and rationale.

Key Investment Merits

Highly predictable recurring revenue model with subscription revenue comprising 98% of Cartrack's revenue.
Exceptional unit economics with a Lifetime Value to Customer Acquisition Cost (LTV:CAC) ratio above 9x.
Strong balance sheet with a net cash position and no material long-term debt, supporting self-funded expansion and a growing dividend yield.

Key Investment Risks

Geographic concentration risk, with South Africa still accounting for the vast majority of subscription revenue.
Near-term gross margin pressure driven by investments in sales, marketing, and higher in-vehicle IoT device costs.
Execution and integration risks associated with scaling the Karooooo Logistics segment.

Thesis Invalidation Triggers

A sustained drop in commercial customer ARR retention below 90%.
Failure to achieve profitability in the Southeast Asian expansion within the medium term.
Severe macroeconomic deterioration or currency devaluation in South Africa.

All scenarios are estimates and subject to change. Past performance is not indicative of future results.

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Explore this dossier

ValuationIntrinsic value, the six-method breakdown, peer medians, and your assumptions sandbox.Financial SnapshotRevenue, profitability, returns, balance sheet, dividends, and the filing-level detail.Qualitative AnalysisBusiness overview, strategic initiatives, and mergers, acquisitions & partnerships.Outlook & Key DatesForward estimates, reporting calendar, and the monitoring framework.