Is Karooooo Ltd. overvalued or undervalued?

As of 24 October 2025, the valuation grade for Karooooo Ltd. has moved from attractive to very attractive, indicating a positive shift in its perceived value. The company appears to be undervalued, supported by a P/E ratio of 34, an EV to EBITDA of 16.34, and a PEG ratio of 1.00, which suggests that the stock is reasonably priced relative to its growth expectations. In comparison, HealthStream, Inc. has a higher P/E ratio of 40.95, while Planet Labs PBC shows a negative P/E, highlighting Karooooo's relative strength in valuation metrics.
Karooooo's recent performance shows a 1-year return of 19.99%, outperforming the S&P 500's return of 16.90%, and a 3-year return of 97.49% compared to the S&P 500's 78.85%. This strong performance reinforces the notion that the stock is undervalued, as it has delivered superior returns relative to the benchmark.