Is RB Global (RBA) a Strong Buy Over Copart (CPRT) in the High-Growth Auction Marketplace Sector?

The auction marketplace sector, a critical component of the automotive and insurance ecosystems, has seen significant evolution in 2025. Two key players-RB Global (RBA) and Copart (CPRT)-are navigating a landscape shaped by shifting vehicle complexity, salvage demand, and macroeconomic headwinds. This analysis evaluates their comparative valuation and growth potential, focusing on recent financial performance, long-term projections, and sector dynamics to determine which stock offers a superior risk-reward profile.

RB Global (RBA): A Surge in Revenue and Strategic Momentum

RB Global's third-quarter 2025 results underscore its rapid ascent. The company reported revenue of $1.09 billion, a 12% year-over-year increase, and net income of $95.5 million, with EPS of $0.93 surpassing analyst expectations of $0.83. This performance was driven by new contract wins, particularly its expanded partnership with the U.S. General Services Administration, which positions RBA to capitalize on government fleet vehicle auctions. Insider confidence further bolsters optimism: Director Deborah Stein's purchase of 1,000 shares marked the first insider buy in a year, signaling strong internal conviction.

Looking ahead, RBA projects $5.7 billion in revenue and $913.2 million in earnings by 2028, implying an 8.6% annual revenue growth rate. While this pace is robust, it lags behind Copart's projected 13.1% annual revenue growth. However, RBA's recent momentum, coupled with its focus on government contracts, offers a unique edge in a sector increasingly influenced by specialized vehicle demand.

Copart (CPRT): Stability and Long-Term Ambition

Copart's Q3 2025 results were mixed. Revenue remained flat at $1.16 billion year-on-year, missing analyst estimates by 2.1%, while GAAP EPS of $0.41 beat expectations by 3.5%. Adjusted EBITDA of $484.9 million reflected a 42% margin, and operating margins improved to 37.3% from 35.4% in the prior year. Despite these gains, Copart's growth trajectory appears constrained by declining unit volumes and inventory levels, as noted in its Q1 2026 earnings call.

However, Copart's long-term ambitions are formidable. The company aims for $6.6 billion in revenue and $2.1 billion in earnings by 2028, requiring a 13.1% annual revenue growth rate. This targets are underpinned by strategic investments in technology, such as its Total Loss Assist initiative with Hi Marley, and expansion beyond the insurance sector. Copart's financial health also strengthens its case: it holds $6.5 billion in cash and cash equivalents with no debt, and its low debt-to-equity ratio (0.011) and robust current ratio (8.42) highlight its resilience.

Sector Dynamics: Vehicle Complexity and Salvage Demand

The auction sector is being reshaped by two key trends. First, electric vehicle (EV) sales in the U.S. and Germany are projected to decline in 2025 due to tax credit eliminations and rising costs, potentially reducing the volume of high-value salvage units. Second, demand for specialized armored vehicles in the Middle East and Africa is surging, with the 8x8 armored vehicle market expected to grow at a 5.4% CAGR from 2025 to 2030. This trend aligns with RBA's government partnerships, which could benefit from increased defense spending and the need for secure vehicle disposal.

For Copart, the challenge lies in adapting to these shifts. While its technology-driven approach improves auction throughput, its reliance on traditional insurance-driven salvage may limit growth unless it pivots toward niche markets like armored vehicles.

Risk-Reward Analysis: RBA's Momentum vs. CPRT's Resilience

RBA's recent outperformance and insider confidence make it an attractive short- to medium-term play, particularly for investors seeking exposure to government contracts and specialized vehicle markets. However, its 8.6% projected growth rate is modest compared to Copart's 13.1%, and its lack of detailed long-term guidance introduces uncertainty.

Copart, by contrast, offers a more balanced risk-reward profile. Its strong liquidity, low debt, and ambitious long-term targets position it to weather sector volatility while scaling through innovation. The company's premium valuation metrics (P/E of 25.82, price-to-sales of 8.63) reflect investor confidence in its ability to sustain growth. Yet, its recent flat revenue growth and dependence on insurance-driven salvage pose near-term risks.

Conclusion: A Tug-of-War Between Momentum and Resilience

RB Global's recent surge and strategic partnerships make it a compelling short-term bet, particularly in a sector where government contracts and armored vehicle demand are gaining traction. However, Copart's long-term ambition, financial strength, and technological edge suggest it is better positioned to capitalize on the auction sector's evolving dynamics. For investors prioritizing stability and scalable growth, Copart (CPRT) emerges as the stronger buy. That said, RBA's momentum and niche focus warrant close monitoring, especially if sector trends favor government and specialized vehicle markets.