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1. Company Snapshot

1.a. Company Description

Casey's General Stores, Inc., together with its subsidiaries, operates convenience stores under the Casey's and Casey's General Store names.Its stores offer a selection of food, including freshly prepared foods, such as pizza, donuts, and sandwiches; beverages; tobacco and nicotine products; health and beauty aids; automotive products; and other nonfood items.The company's stores also provide motor fuel for sale on a self-service basis; and gasoline and diesel fuel.


In addition, its stores offer various products, include soft drinks, energy, water, sports drinks, juices, coffee, and tea and dairy products; beer, wine, and spirits; snacks, candy, packaged bakery, and other food items; ice, ice cream, meals, and appetizers; health and beauty aids, electronic accessories, housewares, and pet supplies; and lotto/lottery and prepaid cards.Further, the company operates two stores that sells tobacco and nicotine products; one liquor store; and one grocery store.As of April 30, 2022, it operated 2,452 convenience stores.


Casey's General Stores, Inc.was founded in 1959 and is headquartered in Ankeny, Iowa.

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1.b. Last Insights on CASY

Casey's General Stores' recent performance was driven by strong Q4 earnings, beating estimates with a 12.4% increase in diluted EPS to $2.63. The company's net income rose 13.0% to $98.3 million, and EBITDA increased 20.1% to $263.0 million. Inside same-store sales growth of 1.7% contributed to the strong performance, along with increased fuel gallons sold and operational efficiencies. The company's acquisition of Fikes, which was completed in the quarter, also had a positive impact on results. Additionally, Casey's announced a dividend increase, further boosting investor confidence.

1.c. Company Highlights

2. Casey's General Stores Posts Strong Q2 Earnings, Driven by Same-Store Sales Growth

Casey's General Stores reported its second-quarter fiscal year 2026 earnings, with diluted EPS of $5.53 per share, significantly beating estimates of $5.19, and net income of $206 million, both up 14% from the prior year. The company generated $410 million in EBITDA, a 17.5% increase from the prior year. Total revenue was $4.51 billion, up 14.2% from the prior year, driven by a 3.3% increase in same-store sales, with prepared food and dispensed beverage sales up 4.8%. The company's fuel gallons sold increased 0.8%, with a fuel margin of 41.6 cents per gallon.

Publication Date: Dec -20

📋 Highlights
  • EBITDA Growth: Reached $410 million, up 17.5% YoY, with full-year guidance raised to 15-17% growth.
  • Same-Store Sales: Rose 3.3%, driven by 4.8% growth in prepared food and dispensed beverages.
  • Free Cash Flow: Generated $176 million, supporting $31 million in share repurchases (part of $200M FY26 target).
  • Fuel Margin: Stabilized at 41.6 cents per gallon, with lower fuel prices boosting discretionary spending.
  • Cefco Rebranding: Expected to improve margins as conversion begins in CY2026, though current EBITDA is healthy but not EPS-accretive.

Operational Highlights

The company saw margin expansion in the grocery and general merchandise category, driven by increased guest traffic and effective merchandising. The prepared food margin in Cefco stores is about half of Casey's, but the rebranding effort is expected to start in earnest at the beginning of the calendar year, which will likely improve margins. The company is focused on driving traffic, delivering outsized growth in high-margin categories, and having great overall satisfaction scores.

Guidance and Outlook

The company updated its EBITDA guidance for the fiscal year, expecting EBITDA to increase 15% to 17%, with inside same-store sales growth of 3% to 4%. The tax rate is expected to be 24% to 25%. The guidance implies a sequential deceleration in EBITDA growth in the second half, largely due to the easy comparison in the first half and the lapping of the Fikes acquisition in November.

Valuation and Growth Prospects

With a P/E Ratio of 34.16 and EV/EBITDA of 15.34, the market is pricing in significant growth expectations. Analysts estimate next year's revenue growth at 9.0%. The company's strong performance and guidance suggest that it is on track to meet or exceed these expectations. The company's ROIC of 104.0% and ROE of 22.98% indicate a strong ability to generate returns on capital.

Strategic Initiatives

The company is testing wings in a limited number of stores and refining its operations and offering, with a potential rollout planned around calendar events like the Super Bowl or March Madness. The company is also resetting store layouts to allocate more space to nicotine alternatives, which are expected to continue growing rapidly.

Competitive Landscape

The company is confident in its ability to compete with private convenience stores, citing its differentiated offer and strong performance in competitive markets. The government shutdown had a minimal effect on the business, as SNAP-eligible sales account for less than 2% of total sales.

3. NewsRoom

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Is the Options Market Predicting a Spike in Casey's Stock?

Feb -09

Source: zacks.com

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Best Growth Stocks to Buy for February 9th

Feb -09

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Envestnet Asset Management Inc. Has $231.15 Million Stock Holdings in Casey’s General Stores, Inc. $CASY

Feb -06

Source: defenseworld.net

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Feb -05

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Casey's General Stores (CASY) Just Flashed Golden Cross Signal: Do You Buy?

Feb -03

Source: zacks.com

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AE Wealth Management LLC Buys 1,162 Shares of Casey’s General Stores, Inc. $CASY

Feb -03

Source: defenseworld.net

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Feb -02

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4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (2.62%)

6. Segments

Fuel

Expected Growth: 2.5%

Casey's General Stores, Inc.'s 2.5% fuel growth is driven by increasing same-store sales, strategic pricing, and expanded fuel offerings. Additionally, the company's growing convenience store count, particularly in rural areas, contributes to higher fuel volumes. Furthermore, Casey's loyalty program and mobile app enhancements encourage repeat business and drive fuel sales.

Grocery and General Merchandise

Expected Growth: 2.8%

Casey's General Stores, Inc.'s 2.8% growth in Grocery and General Merchandise is driven by increasing same-store sales, successful private label offerings, and strategic pricing initiatives. Additionally, the company's focus on enhancing the customer shopping experience through remodels and technology investments has contributed to the growth.

Prepared Food and Dispensed Beverage

Expected Growth: 3.2%

Casey's Prepared Food and Dispensed Beverage segment growth of 3.2% is driven by increased demand for convenience and quality food options, successful implementation of digital marketing strategies, and expansion of mobile ordering and curbside pickup services, as well as favorable weather conditions and strategic pricing initiatives.

Other

Expected Growth: 2.2%

Casey's General Stores, Inc.'s 2.2% growth in 'Other' segment is driven by increased sales of private label products, expansion of grocery and general merchandise offerings, and strategic partnerships to enhance customer experience. Additionally, the company's focus on digital transformation, including mobile apps and online ordering, has contributed to the growth.

7. Detailed Products

Fuel

Casey's General Stores, Inc. operates a chain of convenience stores that offer a range of fuel options, including gasoline, diesel, and alternative fuels.

Food and Beverages

Casey's offers a variety of prepared foods, including pizza, sandwiches, salads, and snacks, as well as a range of hot and cold beverages.

Convenience Items

Casey's stores carry a range of convenience items, including groceries, health and beauty aids, and other everyday essentials.

Private Label Products

Casey's offers a range of private label products, including coffee, water, and snacks, under its own brand names.

Pizza Delivery

Many Casey's locations offer pizza delivery, allowing customers to order hot, fresh pizzas and have them delivered to their doorstep.

8. Casey's General Stores, Inc.'s Porter Forces

Forces Ranking

Threat Of Substitutes

Casey's General Stores, Inc. faces moderate threat from substitutes due to the presence of alternative convenience stores and grocery stores that offer similar products and services.

Bargaining Power Of Customers

Casey's General Stores, Inc. has a low bargaining power of customers due to its strong brand presence and limited switching costs for customers.

Bargaining Power Of Suppliers

Casey's General Stores, Inc. faces moderate bargaining power of suppliers due to the presence of multiple suppliers for its products and services.

Threat Of New Entrants

Casey's General Stores, Inc. faces low threat from new entrants due to the high barriers to entry in the convenience store industry, including high capital requirements and regulatory hurdles.

Intensity Of Rivalry

Casey's General Stores, Inc. operates in a highly competitive industry with many established players, leading to a high intensity of rivalry among competitors.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 38.61%
Debt Cost 4.07%
Equity Weight 61.39%
Equity Cost 8.06%
WACC 6.52%
Leverage 62.89%

11. Quality Control: Casey's General Stores, Inc. passed 5 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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GPC

A-Score: 5.6/10

Value: 3.7

Growth: 5.1

Quality: 4.2

Yield: 6.0

Momentum: 6.0

Volatility: 8.7

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Casey's General Stores

A-Score: 5.5/10

Value: 2.9

Growth: 7.0

Quality: 5.4

Yield: 0.0

Momentum: 9.0

Volatility: 8.7

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Value: 9.3

Growth: 4.2

Quality: 5.9

Yield: 6.0

Momentum: 1.5

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Academy Sports

A-Score: 4.7/10

Value: 7.1

Growth: 6.4

Quality: 5.6

Yield: 1.0

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A-Score: 4.0/10

Value: 3.9

Growth: 8.0

Quality: 4.1

Yield: 0.0

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

653.72$

Current Price

653.72$

Potential

-0.00%

Expected Cash-Flows