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Category: Stock Market and Casey's (CASY)
Date: 11 September 2020 Stock Price of Casey: $177.08 We take a look at the 1st quarter earnings release of their 2021 fiscal year of Casey's General Stores on of the biggest general store groups in the USA, with their 1st quarter 2021 revenues topping $2.1 billion, down just over -19% and net earnings for the quarter coming in at $120.6 million.
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- I am exceptionally proud of our team members, who have risen to the challenge to safely serve our guests throughout this period, said Darren Rebelez, President and Chief Executive Officer. "
About Casey's General Stores
Headquartered in Ankeny, Iowa, Casey's General Stores, Inc. operates more than 2,000 convenience stores in 16 Midwestern states. Casey's offers self-service gasoline, a wide selection of grocery items and an array of freshly prepared food items. Among the most popular of Casey's prepared foods are their made-from-scratch pizzas, donuts, subs and sandwiches. Casey's operates from two company distribution centers, enabling an approximate delivery of 90% of in-store products as well as 75% of fuel.
The first store opened in 1968 in Boone, Iowa. In the years following, Casey's found success by opening stores in other small towns across Iowa. Approximately 57% of Casey's stores are still found in areas with populations of 5,000 or less. In contrast, roughly 17% of Casey's are now located in areas with populations of 20,000 or more. Casey's has a strong balance sheet and owns nearly all of its assets, which allows the company to consistently take advantage of growth opportunities.
The first store opened in 1968 in Boone, Iowa. In the years following, Casey's found success by opening stores in other small towns across Iowa. Approximately 57% of Casey's stores are still found in areas with populations of 5,000 or less. In contrast, roughly 17% of Casey's are now located in areas with populations of 20,000 or more. Casey's has a strong balance sheet and owns nearly all of its assets, which allows the company to consistently take advantage of growth opportunities.
Overview of Casey's General Stores 1st quarter 2021 earnings report
The data below refers to the latest quarter unless specified otherwise:
- Total Revenue: $2.105 billion (down from $2.626 billion for the same quarter of the previous year)
- Total revenues decreased by -19.8% over the last 12 months
- Cost of goods sold: $1.481 billion (down from $2.060 billion for the same quarter of the previous year)
- Cost of goods sold decreased by -28.1% over the last 12 months
- Net income: $120.592 million (up from $85.815 million for the same quarter of the previous year)
- Diluted income per share: $3.24 (up from $2.31 for the same quarter of the previous year)
- PE ratio of Casey's: 13.7
- Dividend declared for quarter: $0.32
- Dividend yield of Casey's: 0.72%
- Diluted number of shares outstanding: 37.242 million (up from 37.085 million for the same quarter of the previous year)
- Cash and cash equivalents: $246.516 million
- Cash and cash equivalents per share: $6.62
- Cash and cash equivalents makes up 6% of Casey's total assets
- Cash and cash equivalents makes up 3.74% of Casey's current market capital
- Receivables: $55.647 million
- Trade receivables makes up 1.35% of Casey's total assets
- Inventories: $238.8 million
- Inventories makes up 5.82% of Casey's total assets
- Stockholders equity in Casey's General Stores: $1.751 billion
- Stockholders equity per share: $47.02
- Casey's General Stores are trading at 3.76 times its stockholders equity per share which is within the expected range of between 2 and 4 times that most firms tend to trade at
- For perspective the average price to book value of firms in the S&P 500 is 3.7. Read more about the S&P 500 here
Casey's General Stores' management commentary on their 1st quarter 2021 earnings report
ANKENY, Iowa--(BUSINESS WIRE)-- Casey’s General Stores, Inc. ("Casey's" or the "Company") (Nasdaq symbol CASY) one of the leading convenience store chains in the United States, today announced financial results for the three months ended July 31, 2020.
First Quarter Key Highlights
“Throughout the first quarter, Casey’s demonstrated the ability to both safely serve our communities and guests through a constantly changing environment and deliver strong results,” said President and CEO Darren Rebelez. “Sales volumes improved this quarter, combined with solid fuel margin execution and disciplined operating expense control, resulting in 40% growth in diluted earnings per share. Casey's continues to execute on our strategic plan, including investment in the guest experience with new digital capabilities to engage our guests today, and down the road.”
First Quarter Key Highlights
- Diluted earnings per share of $3.24 compared to $2.31 for the same period a year ago, an increase of 40.3%.
- Fuel gross profit increased 39% driven by a fuel margin of 38.2 cents for the quarter versus 24.4 cents in the prior-year. Same-store gallons sold decreased 14.6% in the first quarter compared to the prior year.
- Inside same-store sales were approximately flat for the quarter with an average margin of 39.6%. Digital revenue grew 162% in the quarter.
- Casey’s Rewards exceeded 2.5 million members, a 25% increase from April 30, 2020.
- Liquidity remains strong with approximately $572 million available. $569 million in debt was refinanced to 2030 and 2032.
“Throughout the first quarter, Casey’s demonstrated the ability to both safely serve our communities and guests through a constantly changing environment and deliver strong results,” said President and CEO Darren Rebelez. “Sales volumes improved this quarter, combined with solid fuel margin execution and disciplined operating expense control, resulting in 40% growth in diluted earnings per share. Casey's continues to execute on our strategic plan, including investment in the guest experience with new digital capabilities to engage our guests today, and down the road.”
Liquidity
At July 31st, the Company had approximately $572 million in available liquidity, consisting of approximately $247 million in cash and cash equivalents on hand and $325 million in borrowing capacity on existing lines of credit. On August 10, 2020, the Company completed the refinancing of the $569 million 5.22% notes due August 2020 with the proceeds from $650 million 2.85% and 2.96% senior notes, issued via private placement, maturing August 7, 2030 and August 6, 2032.
Share Repurchase
The Company has $300 million remaining under its existing share repurchase program. There were no repurchases made against that authorization in the first quarter.
Dividend
At its September meeting, the Board of Director declared a quarterly dividend of $0.32 per share. The dividend is payable November 16, 2020 to shareholders of record on November 2, 2020.
At July 31st, the Company had approximately $572 million in available liquidity, consisting of approximately $247 million in cash and cash equivalents on hand and $325 million in borrowing capacity on existing lines of credit. On August 10, 2020, the Company completed the refinancing of the $569 million 5.22% notes due August 2020 with the proceeds from $650 million 2.85% and 2.96% senior notes, issued via private placement, maturing August 7, 2030 and August 6, 2032.
Share Repurchase
The Company has $300 million remaining under its existing share repurchase program. There were no repurchases made against that authorization in the first quarter.
Dividend
At its September meeting, the Board of Director declared a quarterly dividend of $0.32 per share. The dividend is payable November 16, 2020 to shareholders of record on November 2, 2020.
Casey's General Stores (NASDAQ: CASY) stock price history over the last 5 years
The image below shows the stock price history of Casey's over the last 5 years. And its been a very good time for the group. With stockholders being handsomely rewarded during the last 5 years. 5 years ago the stock was trading at around $110 and its currently trading at $177.08. Thats a very handsome 60.9% return over the last 5 years.
Casey's is trading at a lot closer to its 52 week high of $183.45 than it is to its 52 week low of $114.01 which to us is indication that the sentiment and momentum of Casey's stock is very positive.
Casey's is trading at a lot closer to its 52 week high of $183.45 than it is to its 52 week low of $114.01 which to us is indication that the sentiment and momentum of Casey's stock is very positive.
Casey's General Stores (CASY) vs Kroger Company (KR) vs Dollar General (DG)
The image below shows the stock price performance of Casey's General Stores (CASY) vs Kroger Company (KR) vs Dollar General (DG) over the last 3 years. While all three stores are active in the general retail sector in the United States, the stock price trends and returns provided of these stocks are very different over the last 3 years. Below the summary of the three stocks stock returns over the last 3 years:
The stock of Dollar General has easily outperformed that of Kroger and Casey's over the last 3 years. Casey's has been the worst performer of the three stocks over the last three years.
- Dollar General (DG): 148.48%
- Kroger Company (KR): 72.07%
- Casey's General Stores (CASY): 59.70%
The stock of Dollar General has easily outperformed that of Kroger and Casey's over the last 3 years. Casey's has been the worst performer of the three stocks over the last three years.
Recent coverage of Casey's General Stores
The extract below covers the latest earnings from Casey's as obtained from SimplyWall.St
Most readers would already be aware that Casey’s General Stores’ (NASDAQ:CASY) stock increased significantly by 17% over the past three months. Since the market usually pay for a company’s long-term fundamentals, we decided to study the company’s key performance indicators to see if they could be influencing the market. Particularly, we will be paying attention to Casey’s General Stores’ ROE today.
Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. Put another way, it reveals the company’s success at turning shareholder investments into profits.
Casey’s General Stores’ Earnings Growth And 16% ROETo start with, Casey’s General Stores’ ROE looks acceptable. Further, the company’s ROE compares quite favorably to the industry average of 10.0%. However, for some reason, the higher returns aren’t reflected in Casey’s General Stores’ meagre five year net income growth average of 4.7%. This is interesting as the high returns should mean that the company has the ability to generate high growth but for some reason, it hasn’t been able to do so. Such a scenario is likely to take place when a company pays out a huge portion of its earnings as dividends, or is faced with competitive pressures.
Next, on comparing Casey’s General Stores’ net income growth with the industry, we found that the company’s reported growth is similar to the industry average growth rate of 5.2% in the same period.
Read the full article here
Most readers would already be aware that Casey’s General Stores’ (NASDAQ:CASY) stock increased significantly by 17% over the past three months. Since the market usually pay for a company’s long-term fundamentals, we decided to study the company’s key performance indicators to see if they could be influencing the market. Particularly, we will be paying attention to Casey’s General Stores’ ROE today.
Return on Equity or ROE is a test of how effectively a company is growing its value and managing investors’ money. Put another way, it reveals the company’s success at turning shareholder investments into profits.
Casey’s General Stores’ Earnings Growth And 16% ROETo start with, Casey’s General Stores’ ROE looks acceptable. Further, the company’s ROE compares quite favorably to the industry average of 10.0%. However, for some reason, the higher returns aren’t reflected in Casey’s General Stores’ meagre five year net income growth average of 4.7%. This is interesting as the high returns should mean that the company has the ability to generate high growth but for some reason, it hasn’t been able to do so. Such a scenario is likely to take place when a company pays out a huge portion of its earnings as dividends, or is faced with competitive pressures.
Next, on comparing Casey’s General Stores’ net income growth with the industry, we found that the company’s reported growth is similar to the industry average growth rate of 5.2% in the same period.
Read the full article here
Casey's General Stores (NASDAQ: CASY) latest stock valuation
So based on Casey's 1st quarter 2021 earnings report what are Casey's General Stores stock worth? Based on the earnings report and fiscal guidance provided by Casey's General Stores our valuation models has a target (full value) price on Casey's General Stores of $186.20 a stock (up from our 4th quarter 2020 earnings report valuation of Casey's)
We therefore believe the stock of Casey's General Stores is slightly undervalued at its current price of $177.08. We suggest looking to buy into Casey's General Stores of at least 10% below our target price. So a suggested entry price is closer to $159.40 a stock. We expect the stock price of Casey's General Stores to trade in a narrow range around its current price.
We therefore believe the stock of Casey's General Stores is slightly undervalued at its current price of $177.08. We suggest looking to buy into Casey's General Stores of at least 10% below our target price. So a suggested entry price is closer to $159.40 a stock. We expect the stock price of Casey's General Stores to trade in a narrow range around its current price.
Next earnings release of Casey's General Stores
It is expected that Casey's will release their 2nd quarter 2021 earnings report in early December 2020