Copart Inc (CPRT)
Return on total capital
| Jul 31, 2025 | Jul 31, 2024 | Jul 31, 2023 | Jul 31, 2022 | Jul 31, 2021 | ||
|---|---|---|---|---|---|---|
| Earnings before interest and tax (EBIT) | US$ in thousands | 1,895,580 | 1,572,020 | 1,486,780 | 1,375,620 | 1,137,540 |
| Long-term debt | US$ in thousands | — | — | — | — | — |
| Total stockholders’ equity | US$ in thousands | 9,187,030 | 7,524,010 | 5,987,440 | 4,625,600 | 3,529,200 |
| Return on total capital | 20.63% | 20.89% | 24.83% | 29.74% | 32.23% |
July 31, 2025 calculation
Return on total capital = EBIT ÷ (Long-term debt + Total stockholders’ equity)
= $1,895,580K ÷ ($—K + $9,187,030K)
= 20.63%
The analysis of Copart Inc.'s return on total capital over the specified period reveals a discernible downward trend. As of July 31, 2021, the company's return on total capital stood at 32.23%, indicating a strong level of profitability relative to its total capital base at that time. By July 31, 2022, this metric declined to 29.74%, reflecting a decrease but still signifying a solid return. The subsequent year, July 31, 2023, experienced a further reduction to 24.83%, suggesting a continued decline in efficiency or profitability generated from the company's total capital.
This downward trajectory persisted into the periods ending July 31, 2024, and July 31, 2025, with the return on total capital decreasing to 20.89% and then marginally to 20.63%, respectively. The pattern indicates that Copart Inc. has been experiencing diminishing returns on its total capital investment over these years. Such a trend could result from various factors including increased capital expenditures, changes in operational efficiency, market conditions, or strategic shifts affecting profitability metrics.
Overall, while the company maintained a relatively high return on total capital throughout the analyzed period, the consistent decline suggests a potential erosion in either operational margins, asset productivity, or both, warranting further investigation into underlying causes to assess future profitability prospects.