Alimentation Couche-Tard (B) (ATD.B.TO)

His concern is that a lot of their properties are gas stations, which he predicts will decline as the use of e-cars rises. This stock has seen tremendous growth the past five years, but doubts there are more worlds to conquer.

He’s bullish on it. It took a big hit on its first quarterly announcement. The second quarter was fine. The problem was the spike in oil prices. They have a problem keeping up with a rapid price rise, but a quarter later they have caught up and the stock has come back. He thinks the electric vehicle infrastructure will take a lot longer than the market anticipates, which gives Couche-Tard a longer time to adapt. He expects them to turn in nice cash flows under their current model for at least a decade. Headwinds? (a) sharply rising energy prices over the short term; (b) reduced driving miles, as a social trend; (c) currency risk, because they are effectively long the US dollar, though this is currently a tailwind for them; and (d) changing habits of their customers such as increased cigarette regulation.

(A Top Pick March 1/18, Up 1%) Still really likes it. Lower end retail in the US is the place to be. In the sweet spot to benefit from the US tax cut. A global brand. They’ve grown, but not diluted shareholders once. Very clean from a financial perspective.

Is writing puts on this stock a good idea? Writing puts is taking on an obligation to buy the shares at a price below where currently trading. He likes the strategy. It is like a covered call in terms of a profit-loss profile.

Really great numbers last quarter. Convenience stores are projected to grow 4-5% this year. Good acquirers. Merging with Holiday brand. Margins starting to creep up. Not cheap, but you can run with it for a long time because it’s defensive, and Amazon can’t sell you a chocolate bar with your gas. Yield is 0.7%. (Analysts’ price target is $74.69.)

The big move in this one outside of some trading spasms is probably about over. They had a stunning rise on acquisitions. The problem is that they are now so big that in order to have any impact on earnings, the acquisition will have to be enormous.

Trading at 12 times next year earnings and the US investments are yielding benefits. He sees further synergies going forward. They will need to find ways to add loyalty plans and continue to grow revenues. The CircleK name is a good way to do it. Over 65% of their revenues are coming from the US now. Yield 0.7%. (Analysts’ price target is $74.69)

(A Top Pick March 1/18 Down 4%) They reported strong earnings a couple of years ago and they are looking at rebranding in the US under the Circle K name. Over 65% of their business is in the US now. It is fairly valued with US growth opportunity.

It is a really well run company and a great Canadian success story. They reported a very strong quarter recently and the stock popped and then came off. People are worried about electrical vehicles and what will happen to gas stations. They have not done a big deal recently and they grow through acquisition. It has gone sideways for the last couple of years so the valuation has come down, so it has come onto his radar screen. It is representing better value now.

His model price is $75.91, which is a 20% upside. However, he sees strong resistance at $67.85.He thinks that is the top, for now. He would hold at this price.

He really likes the company. He likes the management team with an unbelievable long term track record. There were concerns about fuel margins. There is store rebranding so it will be circle K all over. He really increased his position earlier in the year. He thinks you are paying a very fair price for the business and could hold it for a fair amount of time.

He loves this stock and was happy to see it rise today. Great management. They fell into tough times the past 18 months and that's when he pulled out. Today's move encourages him to re-buy it. A Canadian success story in Europe and the U.S. Growth through M&A, but they needed a break from this, which is why the stock went sideways. He think they will resume buying.

It's gone nowhere the past few years, stretched from some acqusitions, and fears of e-cars. However, ATD is testing charging stations at its stations. Also, as long as people like junk food, ATD will do okay. He wishes he had bought this in the low-$50's.

She views it as a growth stock. They acquire chains in the US and outside North America and are very good at fitting them in. They are very good operators. Traffic at its stores has been muted for the past few years. She would prefer to be in a sector that has strong inherent growth rather than growth by acquisition. This provides a tailwind rather than the headwind faced by companies like Couche-Tard. (Analysts’ price target is $73.64)

He owned this for 5 years while it was growing, but it has now become a source of cash: investors sell this stock to put their money elsewhere. The company got expensive but valuation is improving as the price declines. Price momentum at this time is very bad. It has been providing good return on equity (21%). It has good quality of earnings, though it missed on its last quarter earnings, but with the negative tailwinds, he would wait until it drops far enough to have a compelling valuation. (Analysts’ price target is $73.64)