CASY Reports Earnings

Investment Analysis Clubs Saul’s Investing Discussions
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CASY reported earnings today after the market close.

Casey’s General Stores Inc. (CASY) announced earnings for third quarter that decreased compared to the same period last year.

The company said its bottom line totaled $38.10 million, or $0.97 per share. This was down from $39.32 million, or $1.01 per share, in last year’s third quarter.

Analysts had expected the company to earn $0.94 per share, according figures compiled by Thomson Reuters. Analysts’ estimates typically exclude special items.

Read more: http://www.nasdaq.com/article/caseys-general-stores-inc-bott…

Here’s a look at their latest numbers:


Revenue (billions)	Q1		Q2		Q3		Q4
2014							1.790		1.920
2015			2.291		2.150		1.672		1.654
2016			2.049		1.925		1.566		

EPS (Diluted)		Q1		Q2		Q3		Q4	
2014							0.33		0.54	
2015			1.28		1.28		1.01		1.05
2016			1.57		2.00		0.97

Current (2016 Q3 Earnings):

Revenue Growth (billions)
2014 Q4 TTM Revenue = 8.033
2015 Q4 TTM Revenue = 7.194
Year Over Year Revenue Growth = -10.44%, previously -10.44%

EPS Growth (non-GAAP)
2014 Q4 TTM Earnings = 4.11
2015 Q4 TTM Earnings = 5.59
Year Over Year EPS Growth = 36%, previously 64%

P/E (Check Current Price) = 102.36/5.59 = 18.31

1YPEG = 18.31/36 = 0.51

I was concerned about their drop in earnings, but the press release contained this nugget:

“Total inside gross profit was up over 13% in the third quarter, driven primarily by improved margin performance in our prepared food category,” stated Chairman and CEO Robert J. Myers. “Our fuel margin per gallon was above our annual goal but still below prior year’s strong results, which impacted diluted earnings per share by approximately 30 cents compared to prior year’s third quarter.”

You can read the entire press release at https://www.caseys.com/sites/default/files/3rdQtrfy2016.pdf

Does this make sense though? I thought margins increased as gas prices dropped so wouldn’t this year’s margins on gas be higher? Maybe there’s a happier middle ground than extremes in either direction?

Price looks to have dropped a percentage point or two in the AH.

Matt
Long CASY
MasterCard (MA) Ticker Guide
See all my holdings at http://my.fool.com/profile/CMFCochrane/info.aspx

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Does this make sense though? I thought margins increased as gas prices dropped so wouldn’t this year’s margins on gas be higher?

So the story is that a year ago fuel margins were unreal and came back to earth this quarter? I don’t get it either. Maybe the CC transcript will shed more light.

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Does this make sense though? I thought margins increased as gas prices dropped so wouldn’t this year’s margins on gas be higher?

I believe I read that last year they locked in prices in the futures market for this year, thinking oil would be up this year instead of continuing to fall, so they didn’t get the benefit of this years lower prices.

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Make sense now, thanks Saul!

Zangwei

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Yep, makes sense. Thanks Saul!

Matt
Long CASY

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I believe I read that last year they locked in prices in the futures market for this year, thinking oil would be up this year instead of continuing to fall, so they didn’t get the benefit of this years lower prices.

They may still have a higher margin in fuel sales, but much lower prices in the last quarter should result in lower overall profits.

JT
Paid $1.28 per gallon last week in Phoenix.