41. Selling wrecked cars to the entire world Titelbild

41. Selling wrecked cars to the entire world

41. Selling wrecked cars to the entire world

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 For our forty-first episode, we're asking a question: what happens after the car crash? [pause] I mean after the tow trucks have come and the insurance claims have been filed. What happens to the cars that are too damaged to be repaired, the ones the insurance company calls a "total loss"? Well, they enter a hidden, multi-billion dollar ecosystem, a massive global marketplace that gives these wrecked vehicles a second life. And that marketplace is dominated by one company. We are talking about Copart.

When you hear the name Copart ($CPRT), you probably think of a massive, sprawling junkyard—an auction house for wrecked and salvaged cars. On the surface, it seems like a gritty, industrial business focused on selling damaged vehicles.
But the real story behind Copart is that it's a technology-driven logistics platform with a nearly impenetrable competitive moat. The company is the indispensable partner for the insurance industry. When a car is declared a total loss, Copart steps in to collect, process, and auction the vehicle on its patented online platform to a global network of buyers. This two-sided network of insurance sellers and licensed buyers creates a powerful flywheel that is almost impossible for competitors to replicate. This has made it one of the market's greatest long-term compounders, but it often trades at a premium valuation.
We're sifting through the salvage to determine if Copart's dominant business model can continue to drive growth and justify its high price tag, or if this stock is due for a wreck.




Created with love by Emil Lazzaroni
2 new episodes per week, until I can find good companies to hold forever.

This is not in any way, shape or form financial advice. You are the sole responsible for the action you take after listening to any of my content.

Always consult a professional before investing.
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