Casey's General (CASY) AI Stock Analysis

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Casey's General

(NASDAQ:CASY)

74Outperform

Casey's General Stores demonstrates strong financial performance with robust revenue growth and efficient cash management. The technical indicators show a positive trend, but with some caution due to potential momentum loss. Valuation metrics suggest the stock might be overvalued, which could limit upside potential. Despite strong sales and strategic expansions, immediate earnings are impacted by acquisition-related costs, as highlighted in the earnings call.

Positive Factors

Competitive Advantage

Casey’s General Stores has a unique position in the U.S. convenience store landscape by focusing operations in small-town and rural markets, offering a meaningful competitive advantage.

Financial Performance

CASY reported a 3Q beat, with revenues growing 17% YoY, and adj. EBITDA and EPS beating cons ests.

Negative Factors

Margin Pressure

Fuel margins are likely to fall short of expectations, which could negatively impact the company's performance.

Stock Valuation

Despite the strong FQ3 performance, a Neutral rating is maintained especially considering CASY’s valuation with the stock trading at a ~29% premium to peers.

Casey's General (CASY) vs. S&P 500 (SPY)

Market Cap

$15.52B

Dividend Yield0.46%

Average Volume (3M)410.47K

Price to Earnings (P/E)29.1

Beta (1Y)0.48

Revenue Growth6.56%

EPS Growth14.06%

CountryUS

Employees20,935

SectorConsumer Cyclical

Sector Strength60

IndustrySpecialty Retail

Share Statistics

EPS (TTM)14.35

Shares Outstanding37,119,003

10 Day Avg. Volume495,772

30 Day Avg. Volume410,474

Financial Highlights & Ratios

PEG Ratio2.07

Price to Book (P/B)N/A

Price to Sales (P/S)0.96

Price to Cash Flow (P/CF)18.30

P/FCF Ratio32.80

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$436.38

Price Target Upside4.78% Upside

Rating ConsensusModerate Buy

Number of Analyst Covering10

Casey's General Business Overview & Revenue Model

Company DescriptionCasey's General Stores, Inc. (CASY) is a chain of convenience stores in the United States, primarily located in the Midwest. The company operates approximately over 2,000 stores across 16 states, offering a mix of prepared foods, groceries, and fuel. Known for its made-from-scratch pizza, Casey's also provides a range of products, including snacks, beverages, and other convenience items, catering to both local residents and travelers.

How the Company Makes MoneyCasey's General Stores generates revenue through three primary streams: fuel sales, in-store merchandise, and prepared food and beverages. Fuel sales account for a significant portion of the company's revenue, driven by its extensive network of gas stations and competitive pricing strategies. In-store merchandise, which includes groceries, snacks, and beverages, contributes to its profit margin by capitalizing on the convenience factor for customers. Additionally, its prepared food and beverages segment, including popular offerings like pizza and sandwiches, provides higher-margin revenue and differentiates Casey's from other convenience stores. The company also leverages its loyalty program and digital initiatives to drive customer engagement and increase sales.

Casey's General Financial Statement Overview

Summary

Casey's General exhibits a robust financial profile with strong revenue growth, efficient profit margins, and effective cash flow management. The balance sheet reflects financial stability with no debt, reducing financial risk. While the Return on Equity is an area for potential improvement, the overall financial health is strong, positioning the company well for continued growth and stability.

Income Statement

Very Positive

The company's income statement shows strong profitability with a Gross Profit Margin of 60.54% and a Net Profit Margin of 3.44% in the TTM period. The revenue has grown impressively by 20.04% from 2022 to 2025, indicating strong growth momentum. The EBIT Margin of 45.33% and EBITDA Margin of 7.25% further support the company's efficient operations and profitability. Overall, Casey's General demonstrates robust revenue growth and solid profit margins, reflecting a strong financial performance.

Balance Sheet

Positive

Casey's General maintains a strong balance sheet with no debt in the TTM period, which significantly reduces financial risk. The Equity Ratio stands at an impressive 162.05%, indicating a strong equity base relative to total assets. However, the Return on Equity is relatively low at 72.91%, suggesting that while the company is well-capitalized, it could improve its efficiency in generating returns on shareholder investments. Overall, the balance sheet is stable and well-positioned with minimal leverage, though there's room for enhancing returns.

Cash Flow

Positive

The cash flow statement indicates positive trends with a Free Cash Flow Growth Rate of 41.16% in the TTM period. The Operating Cash Flow to Net Income Ratio is 1.95, demonstrating strong cash generation from operations. Additionally, the Free Cash Flow to Net Income Ratio of 0.98 reflects efficient cash management practices. Overall, Casey's General exhibits strong cash flow generation and effective operational cash management, which enhances its financial flexibility.

TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Breakdown
Income Statement		Total Revenue
15.55B	14.86B	15.09B	12.95B	8.71B	9.18B
	Gross Profit
3.62B	3.35B	3.07B	2.76B	2.36B	2.14B
	EBIT
767.51M	709.60M	639.33M	497.70M	454.05M	395.47M
	EBITDA
1.16B	1.06B	952.46M	801.24M	719.24M	646.64M
	Net Income Common Stockholders
535.23M	501.97M	446.69M	339.79M	312.90M	263.85M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
394.81M	206.48M	378.87M	158.88M	336.55M	78.28M
	Total Assets
8.22B	6.35B	5.94B	5.51B	4.46B	3.94B
	Total Debt
3.12B	1.64B	1.67B	1.69B	1.36B	1.40B
	Net Debt
2.73B	1.43B	1.29B	1.53B	1.03B	1.33B
	Total Liabilities
4.80B	3.33B	3.28B	3.26B	2.53B	2.30B
	Stockholders Equity
3.42B	3.02B	2.66B	2.24B	1.93B	1.64B
Cash Flow		Free Cash Flow
523.57M	370.95M	405.38M	462.27M	362.84M	65.34M
	Operating Cash Flow
1.05B	892.95M	881.95M	788.74M	804.09M	504.31M
	Investing Cash Flow
-1.75B	-825.36M	-545.03M	-1.16B	-444.34M	-466.64M
	Financing Cash Flow
917.29M	-239.98M	-116.93M	191.59M	-101.48M	-22.69M

Casey's General Technical Analysis

Technical Analysis Sentiment

Positive

Last Price416.49

Price Trends

50DMA

416.34

Positive

100DMA

412.38

Positive

200DMA

395.24

Positive

Market Momentum

MACD

6.57

Negative

RSI

64.28

Neutral

STOCH

92.93

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CASY, the sentiment is Positive. The current price of 416.49 is above the 20-day moving average (MA) of 415.35, above the 50-day MA of 416.34, and above the 200-day MA of 395.24, indicating a bullish trend. The MACD of 6.57 indicates Negative momentum. The RSI at 64.28 is Neutral, neither overbought nor oversold. The STOCH value of 92.93 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CASY.

Casey's General Risk Analysis

Casey's General disclosed 26 risk factors in its most recent earnings report. Casey's General reported the most risks in the “Production” category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

Casey's General Peers Comparison

Overall Rating

UnderperformOutperform

Sector (59)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CASY	74 Outperform	$15.52B	29.13	16.82%	0.46%	6.56%	14.06%
EBAY	73 Outperform	$28.51B	15.52	34.29%	1.80%	2.79%	-23.30%
GPC	68 Neutral	$15.31B	17.05	20.69%	3.65%	1.71%	-30.78%
WSM	66 Neutral	$17.92B	16.51	53.91%	1.57%	-0.50%	24.11%
Sector *	59 Neutral	$10.97B	9.83	-1.56%	4.06%	1.31%	-16.49%
MUSA	58 Neutral	$9.07B	19.01	60.22%	0.41%	-5.97%	-5.45%
AAP	45 Neutral	$2.09B	59.62	-23.45%	3.08%	-9.34%	-852.37%

* Consumer Cyclical Sector Average

Performance Comparison

CASY

Casey's General

416.49

105.74

34.03%

AAP

Advance Auto Parts

30.31

-46.13

-60.35%

EBAY

eBay

59.52

8.02

15.57%

GPC

Genuine Parts Company

105.54

-38.28

-26.62%

MUSA

Murphy USA

465.31

54.01

13.13%

WSM

Williams-Sonoma

139.21

-5.27

-3.65%

Casey's General Earnings Call Summary

Earnings Call Date: Mar 11, 2025 | % Change Since: 9.98% | Next Earnings Date: Jun 16, 2025

Earnings Call Sentiment Neutral

Casey's General Stores presented a mixed earnings call with strong sales and expansion metrics but faced challenges in translating these into net income growth due to acquisition-related costs and margin pressures. The company shows growth potential with successful integration of acquisitions and sales strategies, but immediate earnings are impacted by increased expenses.

Highlights

Strong EBITDA Growth

EBITDA was $242 million, up 11% from the prior year, showcasing strong overall financial performance.

Significant Inside Sales Increase

Inside sales were up over 15% compared to the previous year, demonstrating strong consumer demand and effective sales strategies.

Fuel Gallons Sold Surge

Fuel gallons sold increased by over 20%, indicating successful market penetration and consumer preference for Casey's fuel offerings.

Successful Integration of Fikes Acquisition

Casey's integrated the largest acquisition in its history, increasing store count by 10% year-over-year and contributing to overall revenue growth.

Prepared Food and Beverage Growth

Prepared food and dispensed beverage sales rose 13.7%, driven by innovation in hot sandwiches and bakery items.

Store Count Growth

Store count increased by 10% versus the prior year, demonstrating successful expansion strategies.

Lowlights

Flat Net Income

Net income was flat at $87 million compared to the prior year, indicating challenges in translating revenue growth into profit.

Impact of Fikes Acquisition on Margins

The addition of the CEFCO stores, part of the Fikes acquisition, led to a decline in prepared food margins by 180 basis points.

Decline in Retail Fuel Price

Retail fuel price declined by 4.2%, impacting overall revenue from fuel sales despite increased volume.

Increased Operating Expenses

Operating expenses rose by 17.8%, driven by integration costs and increased store operations, impacting net income.

Dilutive Impact of Fikes on Earnings

Fikes acquisition was dilutive to earnings in the short term, primarily due to increased interest expenses and integration costs.

Company Guidance

During the Q3 Fiscal Year 2025 Casey's General Stores Earnings Conference Call, several key metrics and updates were discussed. The company reported a diluted EPS of $2.33 per share and a net income of $87 million, both remaining flat compared to the previous year. The EBITDA was reported at $242 million, marking an 11% increase from the prior year. Inside sales increased by over 15%, while fuel gallons sold rose by more than 20%. The store count grew by 10% compared to the previous year. The inside same-store sales rose by 3.7% for the quarter, or 8% on a two-year stack basis, with an average margin of 40.9%. Prepared food and dispensed beverage sales showed a robust growth of 4.7% with an average margin of 57.8%. Same-store grocery and general merchandise sales increased by 3.3% with an average margin of 34.2%. The fuel segment experienced a 1.8% increase in same-store gallons sold and a fuel margin of $0.364 per gallon. Total revenue for the quarter reached $3.9 billion, a 17.3% increase from the prior year, driven by a $185 million rise in inside sales and a 20.4% increase in fuel gallons sold, though there was a 4.2% decline in the retail fuel price. Looking ahead, Casey's updated its fiscal year 2025 guidance, expecting EBITDA to increase by approximately 11% and the purchase of property and equipment to be around $500 million.

Casey's General Corporate Events

M&A TransactionsBusiness Operations and StrategyFinancial Disclosures

Casey’s General Reports Strong Q2, Expands with CEFCO Acquisition

Positive

Dec 9, 2024

Casey’s General Stores reported impressive second-quarter financial results with a 14% rise in diluted EPS and net income, driven by strong inside sales growth, particularly in prepared food and beverages. Despite a slight dip in same-store fuel gallons, total fuel gross profit increased, aided by robust margins. The company’s strategic focus on efficiency led to reduced labor hours, and the acquisition of 198 CEFCO Convenience Stores from Fikes Wholesale promises to bolster its market presence.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.