Alimentation Couche-Tard Inc (ATD) AI Stock Analysis

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Alimentation Couche-Tard Inc

(TSX:ATD)

Rating:77Outperform

Price Target:

C$84.00

▲(13.51%Upside)

Alimentation Couche-Tard Inc's strong financial performance and operational efficiency are key drivers of the score. Technical indicators suggest positive momentum, although caution is warranted due to the RSI. Valuation is fair, with a reasonable P/E ratio. Earnings call insights underscore strategic growth in key markets, albeit with some challenges in the U.S. market.

Positive Factors

Acquisition Strategy

ATD outperformed its TTE synergy target and is confident in its future targets, highlighting a strong acquisition strategy.

Customer Engagement

Value meal bundles are accelerating, and the loyalty program is signing on more members who drive incremental sales.

Market Valuation

The stock appears cheap at less than 9x EBITDA, suggesting potential undervaluation and upside.

Negative Factors

Operating Expenses

Higher-than-expected SG&A and D&A growth are currently outpacing gross profit growth.

Same-Store Sales

Slower-than-expected same-store sales in Other Tobacco Products and U.S. food indicate challenges in these segments.

U.S. Market Trends

A decline in U.S. industry c-store merchandise sales by 1.4% year over year suggests flat U.S. merchandise same-store sales.

Alimentation Couche-Tard Inc (ATD) vs. iShares MSCI Canada ETF (EWC)

Market Cap

C$64.56B

Dividend Yield1.15%

Average Volume (3M)1.28M

Price to Earnings (P/E)18.0

Beta (1Y)0.40

Revenue Growth8.61%

EPS Growth-0.93%

CountryCA

Employees149,000

SectorConsumer Cyclical

Sector Strength65

IndustrySpecialty Retail

Share Statistics

EPS (TTM)0.63

Shares Outstanding948,064,400

10 Day Avg. Volume1,055,149

30 Day Avg. Volume1,278,063

Financial Highlights & Ratios

PEG Ratio-0.84

Price to Book (P/B)3.22

Price to Sales (P/S)0.00

P/FCF Ratio17.67

Enterprise Value/Market Cap0.92

Enterprise Value/Revenue0.21

Enterprise Value/Gross Profit4.63

Enterprise Value/Ebitda2.55

Forecast

1Y Price Target

C$82.67

Price Target Upside11.72% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering12

Alimentation Couche-Tard Inc Business Overview & Revenue Model

Company DescriptionAlimentation Couche-Tard Inc. (ATD) is a leading global convenience store operator headquartered in Laval, Quebec, Canada. The company operates a vast network of convenience stores across North America, Europe, and other regions under various brand names, including Circle K, Couche-Tard, and Ingo. Its core offerings include a wide range of convenience products such as food, beverages, snacks, and everyday essentials, along with fuel services at many of its locations.

How the Company Makes MoneyAlimentation Couche-Tard Inc. generates revenue primarily through the sale of merchandise and fuel. The company's convenience stores offer a wide array of products, including food, beverages, snacks, and other everyday items, which contribute significantly to its overall revenue. Fuel sales are another critical revenue stream, as many of its locations provide gasoline and diesel services. The company's earnings are further bolstered by its strategic acquisitions and partnerships, allowing it to expand its market presence and optimize its operations. Couche-Tard benefits from economies of scale and a strong supply chain network, enhancing its profitability and competitive edge in the retail and fuel market.

Alimentation Couche-Tard Inc Earnings Call Summary

Earnings Call Date:Jun 27, 2025

(Q4-2025)

% Change Since: 9.71%|

Next Earnings Date:Sep 03, 2025

Earnings Call Sentiment Neutral

The earnings call presents a balanced view of the company's performance, with strong growth in Europe and Canada, significant progress in meal deals, and expansion in the EV charging network. However, there were challenges in the U.S. market with declines in same-store sales, net earnings, and softness in traffic and fuel demand. Strategic investments and legal reserves also impacted financial results.

Q4-2025 Updates

Positive Updates

Strong Performance in Europe and Canada

Same-store sales increased by 3.4% in Europe and other regions and 3.5% in Canada. Europe's performance was supported by cigarette sales in the Netherlands, while Canada's growth was boosted by the alcohol category.

Record Progress in Organic Growth

Opened nearly 45 stores in the quarter and over 110 stores in North America during the fiscal year. Over 1,000 sites are in the real estate development pipeline.

Significant Growth in Meal Deals

In the U.S., meal deals sold over 500,000 each week by the end of Q4, up over 35% from Q3. In Canada, food bundle sales increased over 50% from the previous quarter.

Expansion in EV Charging Network

Nearly 3,480 charge points in Europe, up nearly 40% from the same quarter last year, with Circle K becoming the most preferred brand for charging in Sweden.

Recognition for Innovative Technology

Awarded the 2025 NACS Convenience Retail Technology Award Europe for an AI-driven digital people platform and advancing the deployment of RELEX in North America for inventory management.

Negative Updates

Decrease in U.S. Same-Store Merchandise Revenue

Same-store merchandise revenues decreased by 0.4% in the United States, impacted by challenging economic and inflationary conditions.

Decline in Net Earnings

For fiscal 2025, net earnings stood at $2.6 billion, a decrease of $149.3 million or 5.5% compared with fiscal 2024.

Traffic and Fuel Demand Softness in the U.S.

Softness in traffic and fuel demand in the United States as low-income consumers were impacted by challenging economic conditions.

Impact of Higher Depreciation and Expenses

Higher depreciation, finance, and operating expenses linked to acquisitions and strategic investments impacted net earnings.

Legal and Environmental Reserves

Approximately $20 million in legal, general liabilities, and environmental reserves tied to specific events in the quarter.

Company Guidance

During the call, Alimentation Couche-Tard provided guidance for its fourth quarter of fiscal year 2025, highlighting several key metrics. The company reported same-store merchandise revenue changes, with a 0.4% decrease in the United States, a 3.4% increase in Europe and other regions, and a 3.5% increase in Canada. In the fuel segment, same-store road transportation fuel volumes decreased by 1.9% in the United States and 0.6% in Europe, while increasing by 3.7% in Canada. The adjusted EBITDA for the quarter saw a 6% increase compared to the previous year. The company also emphasized the growth of its meal deals in North America, with sales rising over 35% from Q3 to over 500,000 meal deals sold weekly by the end of Q4. Loyalty membership in the U.S. reached nearly 10.5 million members, contributing to incremental sales and traffic. Additionally, the company noted its progress in EV charging, with nearly 3,480 charge points in Europe, marking a 40% increase from the previous year. Looking forward, the company remains focused on cost control, aiming for expense growth below inflation, and continues to explore M&A opportunities, including a potential acquisition of Seven & i Holdings.

Alimentation Couche-Tard Inc Financial Statement Overview

Summary

Alimentation Couche-Tard Inc demonstrates strong financial performance with consistent revenue and cash flow growth. The company maintains a stable balance sheet with manageable leverage and effective capital allocation. While net profit margins have faced slight pressure, operational efficiency remains strong, positioning the company well for future growth.

Income Statement

Very Positive

Alimentation Couche-Tard Inc has shown consistent growth in revenue, with a notable increase from $62.8 billion in 2022 to $72.9 billion in 2025. The gross profit margin improved, reaching approximately 17.9% in 2025, indicating effective cost management. However, the net profit margin slightly decreased to 3.5% in 2025, reflecting pressure on net income. EBIT and EBITDA margins remained stable, suggesting operational efficiency.

Balance Sheet

Positive

The company maintains a strong equity position, with an equity ratio improving to around 39.0% in 2025. The debt-to-equity ratio decreased slightly to 0.93, signifying prudent debt management. Return on equity is healthy, reflecting strong shareholder value creation. The balance sheet shows stability, with manageable leverage levels.

Cash Flow

Very Positive

Operating cash flow has shown consistent growth, reaching $5.0 billion in 2025, supporting strong free cash flow generation at $2.7 billion. The free cash flow to net income ratio is robust, indicating efficient cash conversion. The company effectively manages its capital expenditures, supporting sustainable cash flow growth.

Breakdown	TTM	Jun 2025	Jun 2024	Jun 2023	Jun 2022	Jun 2021
Income Statement
Total Revenue	74.18B	72.86B	69.26B	71.86B	62.81B	45.76B
Gross Profit	12.87B	13.02B	12.10B	12.05B	11.00B	10.12B
EBITDA	6.01B	6.08B	5.73B	5.82B	5.27B	5.05B
Net Income	2.59B	2.58B	2.73B	3.09B	2.68B	2.71B
Balance Sheet
Total Assets	36.57B	38.30B	36.94B	29.05B	29.59B	28.39B
Cash, Cash Equivalents and Short-Term Investments	1.78B	2.31B	1.87B	929.20M	2.17B	3.03B
Total Debt	13.91B	13.96B	14.47B	9.47B	9.44B	9.60B
Total Liabilities	22.23B	23.21B	23.64B	16.48B	17.15B	16.21B
Stockholders Equity	14.20B	14.95B	13.19B	12.56B	12.44B	12.18B
Cash Flow
Free Cash Flow	2.53B	2.71B	2.87B	2.54B	2.28B	2.86B
Operating Cash Flow	4.77B	5.04B	4.82B	4.34B	3.94B	4.09B
Investing Cash Flow	-1.47B	-1.58B	-6.60B	-2.28B	-1.80B	-1.39B
Financing Cash Flow	-2.59B	-2.54B	2.21B	-3.35B	-2.95B	-3.43B

Alimentation Couche-Tard Inc Technical Analysis

Technical Analysis Sentiment

Positive

Last Price74.00

Price Trends

50DMA

70.24

Positive

100DMA

70.35

Positive

200DMA

73.19

Positive

Market Momentum

MACD

-0.15

Negative

RSI

66.90

Neutral

STOCH

23.71

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TSE:ATD, the sentiment is Positive. The current price of 74 is above the 20-day moving average (MA) of 69.23, above the 50-day MA of 70.24, and above the 200-day MA of 73.19, indicating a bullish trend. The MACD of -0.15 indicates Negative momentum. The RSI at 66.90 is Neutral, neither overbought nor oversold. The STOCH value of 23.71 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TSE:ATD.

Alimentation Couche-Tard Inc Peers Comparison

Overall Rating

UnderperformOutperform

Sector (62)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CTC.A	78 Outperform	$10.62B	12.44	14.70%	5.10%	-1.12%	201.58%
PET	78 Outperform	C$2.32B	26.44	99.31%	1.41%	4.61%	3.95%
ATD	77 Outperform	C$64.56B	17.99	18.50%	1.15%	8.61%	-0.93%
CTC	76 Outperform	C$10.62B	17.47	14.70%	3.66%	-1.12%	201.58%
Sector *	62 Neutral	AU$2.86B	27.61	4.79%	5.15%	2.38%	-31.70%

* Consumer Cyclical Sector Average

Performance Comparison

TSE:ATD

Alimentation Couche-Tard Inc

74.00

-7.40

-9.09%

TSE:CTC

Canadian Tire

255.00

23.43

10.12%

TSE:CTC.A

Canadian Tire

191.37

57.46

42.91%

TSE:PET

Pet Valu Holdings Ltd.

34.00

7.01

25.97%

Alimentation Couche-Tard Inc Corporate Events

Business Operations and StrategyFinancial Disclosures

Alimentation Couche-Tard Reports Resilient Fiscal 2025 Results Amid Global Challenges

Positive

Jun 25, 2025

Alimentation Couche-Tard Inc. reported its financial results for the fourth quarter and fiscal year 2025, highlighting resilience amid challenging economic and geopolitical conditions. The company maintained stable same-store sales in the U.S. and achieved positive results in Canada and Europe. Despite a slight decrease in net earnings compared to the previous year, Couche-Tard demonstrated strong operational effectiveness and continued investment in technology and customer value. The integration of TotalEnergies assets progressed as planned, and the company focused on strategic initiatives and cost control to support long-term growth. Key highlights include a 2.0% increase in total merchandise and service revenues, a decrease in same-store merchandise revenues in the U.S., and an increase in fuel volumes in Canada.

The most recent analyst rating on (TSE:ATD) stock is a Buy with a C$88.00 price target. To see the full list of analyst forecasts on Alimentation Couche-Tard Inc stock, see the TSE:ATD Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy

Couche-Tard Expands U.S. Commercial Paper Program to $3.5 Billion

Positive

Apr 28, 2025

Alimentation Couche-Tard Inc. has announced an amendment to its U.S. commercial paper program, increasing the issuance limit from US$2.5 billion to US$3.5 billion. This move is intended to support general corporate purposes and reflects the company’s strategic efforts to enhance its liquidity and financial flexibility. The notes issued under this program will remain senior unsecured obligations, backed by the company’s senior revolving credit facility, which also totals US$3.5 billion, ensuring a robust liquidity backstop for note repayment. This expansion of the commercial paper program is a significant step in strengthening Couche-Tard’s financial position and operational capabilities, potentially impacting its market standing and stakeholder interests.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

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.Date of analysis: Jul 18, 2025