Karooooo Ltd. (KARO) vs WeRide Inc. (WRD)

Karooooo Ltd. and WeRide Inc. are both Software Application companies. Karooooo Ltd. and WeRide Inc. are of similar size ($1.9B and $1.8B). WeRide Inc. has negative trailing earnings, so its P/E is not meaningful; Karooooo Ltd. trades at 31.3×. Karooooo Ltd. has the higher net margin (17.8% vs −199.6%) and the higher return on invested capital (29.3% vs −68.9%). Across the 16 metrics below, Karooooo Ltd. leads on 12 and WeRide Inc. on 4.

Valuation

Metric KARO WRD Software Application median
P/E 31.28 n/m 24.79
P/S 5.62 15.35 2.67
P/B 8.70 1.92 3.01
Price to free cash flow n/m n/m 16.59
EV/EBITDA 21.59 n/m 14.40
EV/Sales 5.52 9.36 2.62
Earnings yield 3.20% (13.56%) 0.00%
Free cash flow yield (4.35%) (28.46%) 1.91%

Profitability

Metric KARO WRD Software Application median
Gross margin 67.99% 32.86% 67.03%
Operating margin 25.57% (218.36%) 0.00%
Net margin 17.81% (199.55%) 0.00%
Free cash flow margin 32.53% (436.85%) 4.32%
Return on equity 29.51% (92.25%) 0.00%
Return on assets 18.02% (22.14%) 0.00%
Return on invested capital 29.32% (68.91%) 0.00%

Growth

Metric KARO WRD Software Application median
Revenue growth (TTM) 29.64% — 12.40%
EPS growth (last fiscal year) 12.88% 77.78% —
Revenue growth, 5-year CAGR 17.58% — 13.72%
Net income growth, 5-year CAGR 24.02% — 0.00%

Health

Metric KARO WRD Software Application median
Debt to equity 0.15 0.09 0.02
Current ratio 1.02 5.36 1.55
Net debt to EBITDA (0.26) 4.03 0.06

Dividend

Metric KARO WRD Software Application median
Dividend yield 0.98% — 1.25%
Payout ratio 0.52 — 0.00

Size

Metric KARO WRD Software Application median
Market cap 1.92b 1.79b 396.11m

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