Copart (NASDAQ:CPRT – Get Free Report) and Liquidity Services (NASDAQ:LQDT – Get Free Report) are both business services companies, but which is the better investment? We will compare the two businesses based on the strength of their profitability, risk, institutional ownership, earnings, analyst recommendations, valuation and dividends.
Earnings & Valuation
This table compares Copart and Liquidity Services”s revenue, earnings per share and valuation.
| Gross Revenue | Price/Sales Ratio | Net Income | Earnings Per Share | Price/Earnings Ratio | |
| Copart | $4.24 billion | 10.49 | $1.36 billion | $1.52 | 30.25 |
| Liquidity Services | $363.32 million | 2.13 | $19.99 million | $0.79 | 31.39 |
Institutional and Insider Ownership
85.8% of Copart shares are held by institutional investors. Comparatively, 71.2% of Liquidity Services shares are held by institutional investors. 9.7% of Copart shares are held by company insiders. Comparatively, 28.4% of Liquidity Services shares are held by company insiders. Strong institutional ownership is an indication that large money managers, hedge funds and endowments believe a stock is poised for long-term growth.
Profitability
This table compares Copart and Liquidity Services’ net margins, return on equity and return on assets.
| Net Margins | Return on Equity | Return on Assets | |
| Copart | 32.21% | 18.20% | 16.36% |
| Liquidity Services | 6.31% | 20.89% | 11.33% |
Analyst Recommendations
This is a summary of current ratings for Copart and Liquidity Services, as reported by MarketBeat.com.
| Sell Ratings | Hold Ratings | Buy Ratings | Strong Buy Ratings | Rating Score | |
| Copart | 0 | 3 | 1 | 0 | 2.25 |
| Liquidity Services | 0 | 0 | 2 | 0 | 3.00 |
Copart presently has a consensus price target of $53.33, indicating a potential upside of 15.99%. Liquidity Services has a consensus price target of $38.50, indicating a potential upside of 55.24%. Given Liquidity Services’ stronger consensus rating and higher possible upside, analysts clearly believe Liquidity Services is more favorable than Copart.
Risk & Volatility
Copart has a beta of 1.07, meaning that its stock price is 7% more volatile than the S&P 500. Comparatively, Liquidity Services has a beta of 1.14, meaning that its stock price is 14% more volatile than the S&P 500.
About Copart
Copart, Inc. provides online auctions and vehicle remarketing services. It offers a range of services for processing and selling vehicles over the Internet through its Virtual Bidding Third Generation Internet auction-style sales technology on behalf of vehicle sellers, insurance companies, banks and finance companies, charities, and fleet operators and dealers, as well as individual owners. The company’s services include online seller access, salvage estimation, estimating, end-of-life vehicle processing, virtual insured exchange, transportation, vehicle inspection stations, on-demand reporting, motor vehicle regulatory agency processing, flexible vehicle processing programs, buy it now, member network, sales process, and dealer services. Its services also include buying vehicles through CashForCars.com and Copart Direct. The company sells its products principally to licensed vehicle dismantlers, rebuilders, repair licensees, used vehicle dealers, and exporters, as well as to the general public. It operates in the United States, Canada, the United Kingdom, Brazil, the Republic of Ireland, Germany, Finland, the United Arab Emirates, Oman, Bahrain, and Spain. Copart, Inc. was founded in 1982 and is headquartered in Dallas, Texas.
About Liquidity Services
Liquidity Services, Inc. provides e-commerce marketplaces, self-directed auction listing tools, and value-added services in the United States and internationally. The company operates through four segments: GovDeals, Retail Supply Chain Group (RSCG), Capital Assets Group (CAG), and Machinio. Its marketplaces include liquidation.com that enable corporations to sell surplus and salvage consumer goods and retail capital assets; GovDeals marketplace, which provides self-directed service solutions in which sellers list their own assets that enables local and state government entities, and commercial businesses located in the United States and Canada to sell surplus and salvage assets; and AllSurplus, a centralized marketplace that connects global buyer base with assets from across the network of marketplaces in a single destination. The company also offers a suite of services, including surplus management, asset valuation, asset sales, marketing, returns management, asset recovery, and ecommerce services. In addition, it operates a global search engine platform for listing used equipment for sale in the construction, machine tool, transportation, printing, and agriculture sectors. The company offers products from industry verticals, such as consumer electronics, general merchandise, apparel, scientific equipment, aerospace parts and equipment, technology hardware, real estate, energy equipment, industrial capital assets, heavy equipment, fleet and transportation equipment, and specialty equipment. The company was incorporated in 1999 and is headquartered in Bethesda, Maryland.
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