Karooooo Ltd. (KARO) AI Stock Analysis

Karooooo Ltd. provides mobility software-as-a-service (SaaS) platforms tailored for connected vehicles globally. Its core offering is the Fleet Telematics platform, which delivers real-time operational insights for fleet management and logistics. Solutions include LiveVision for risk management and fleet visibility, and MiFleet for administrative cost management and business intelligence. The company also offers Cartrack Field Service for managing field personnel, asset tracking and recovery services for vehicle security, and insurance telematics analytics that help customize premiums. Founded in 2001 and headquartered in Singapore, Karooooo serves consumers, small businesses, and large commercial enterprises.

Karooooo grew annual revenue from $2.75B in FY2022 to $5.48B in FY2026, achieving a five-year revenue CAGR of 19.1%. Revenue expansion was 20.0% in FY2026, rebounding from 8.6% in FY2025. Gross margin stood at 68.0% in FY2026, while operating margin was 25.8%, down from 28.7% in FY2025. Net income increased to $993.9M in FY2026, producing diluted earnings per share of $32.55. For the trailing twelve months ended May 31, 2026, revenue totaled $5.77B with a 17.8% profit margin, driven by quarterly year-over-year revenue growth of 22.5% and quarterly earnings growth of 11.4%.

As of May 31, 2026, Karooooo held $1.11B in cash and short-term investments against $1.07B in total debt, leaving net cash of $35.4M. Shareholders' equity was $3.58B across total assets of $6.29B, supporting a current ratio of 1.02 and a debt-to-equity ratio of 0.30. In FY2026, the company generated $1.81B in operating cash flow and $1.97B in free cash flow. Capital expenditures were $1.81B, while dividends paid totaled $694.4M.

Karooooo trades at a trailing price-to-earnings ratio of 31.1x and a forward P/E of 26.0x, both above the median of its US-listed Technology peers at 28.1x and 18.8x, respectively. Its enterprise value to EBITDA ratio is 21.5x versus the peer median of 16.6x, while its price-to-sales ratio is 0.3x compared to 2.8x for peers. Over the past year, KARO returned 39.8%, outperforming the S&P 500 (SPY) return of 16.8%. Over five years, the stock gained 109.8% versus 83.0% for the benchmark index.

Karooooo pays an annual dividend with a forward rate of $1.50 per share, yielding 2.48% as of October 16, 2026. The dividend payout ratio stands at 9.2%, and the company has distributed dividends for 5 consecutive years. Its most recent ex-dividend date was July 17, 2026.

Consensus ratings include 3 Strong Buy, 2 Buy, and 1 Hold recommendations, with no Sell ratings. The mean price target of $73.65 sits 22.0% above the last close of $60.38. For the fiscal year ending February 28, 2027, analysts project revenue of $6.56B and EPS of $39.46. Karooooo beat EPS estimates in 3 of the last 4 quarters, and its next earnings date is October 19, 2026.

This page is an AI-written research summary of Karooooo Ltd. (KARO). The text was generated on October 30, 2026 from Quotelinks data as of October 16, 2026 (company profile, annual results, latest balance sheet, valuation, price performance and analyst estimates). An automatic check rejects any draft that contains a figure not found in that data. It is not investment advice; verify figures on the linked tabs before making decisions.

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