With a robust subscriber base and impressive growth trajectory, Karooooo proves resilient to AI disruption. However, potential investors should weigh its high stock valuation carefully.

Karooooo is big on vowels and even bigger on growth. Over three years, this stock has increased in value by more than 140% -- a return that I've thoroughly enjoyed watching in my portfolio. If you include dividends, the return over three years is more than 160%.

Sure, you can cherry-pick different dates and get different answers. The five-year view isn't quite as spectacular as the aforementioned numbers, but a total return of roughly 100% over that period is still nothing to be upset about.

Importantly, the momentum in 2026 has been encouraging, with a year-to-date share price increase of 28%.

The market clearly likes Karooooo, but why? And is it really worth a price/earnings multiple of nearly 30x?

The first question is easier to answer than the second.

A SaaS model that isn't broken

Karooooo's main business, Cartrack, exhibits many of the characteristics that have been associated with software-as-a-service (SaaS) businesses over the past decade.

And unlike many SaaS names, Karooooo isn't being disrupted by AI. For now at least, we live in a world where robots can't respond to your car being hijacked. That Terminator-esque world is some way off -- and that's probably a good thing!...