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

(A Top Pick August 29/16. Down 7.35.) Sometimes these things take patience to pan out. They have a 20+ year record of generating value for shareholders. Reported earnings today, which were better than expected. In addition to organic growth, they have been very, very capable serial acquirers. Just closed on their largest acquisition on June 28, and another US deal yesterday. Both should be accretive. Trading at 16X earnings. This is still a Buy.

This should be able to continue the 20 year+ history of growing earnings. They’ve grown earnings 21% compounded over the last decade. The strategy is to price sharply on fuel. People are very sensitive on gasoline, and merchandise in stores is very attractively displayed. The in-store merchandise draws 3 to 5 times the gross margin that the fuel does. Dividend yield of 0.6%. (Analysts’ price target is $75.)

He likes this. Would love to see it get back to $52.48. His model price is $78.72, a 33% upside. A great growth company and they know what they are doing.

One of the biggest convenience store operators in North America, with growth primarily by acquisition. Lately there has been some negative results from some of their competitors, which is causing some issues. He likes their ability to continue to squeeze earnings out of existing operations as well as doing acquisitions. Not a cheap stock. Probably a good one to accumulate on a pullback.

(A Top Pick June 15/16. Up 16.55%.) He still likes this. It is his only retail holding. They just closed their US acquisition and the stock has started to act a bit better. His one-year target is about $70.

It is a great success story. They have done a good job of consolidating the industry on a global basis. There is not a lot of organic growth and gasoline margins are very thin. 30-40% of sales are from tobacco so he has an ethical problem with it. They have benefited from other retail not selling tobacco. It is not an attractive business, nor is it attractively priced.

Thinks this company is going to do okay. The stock has run into a sort of flat period right now, and he doesn’t see any significant downside. These people are super operators, and seemed to be able to take on good sized acquisitions and make them accretive.

He has been looking at it recently. It is a very good business. The valuation is rich as it always has been. You are seeing the stock fall out of favour. At some point electric vehicles should impact their business (5-10 years out). If he saw a 10% pull back it would be interesting.

This scares him long-term. Imagine that no one owns a car anymore, and there are all electric vehicles, why would you stop at a convenience store/gas station? He doesn’t know how this is going to play out for this company. They make a lot of money selling gasoline.

A very well-run business. They’ve been a consolidator of convenience stores and gas stations around the world. This has grown aggressively and has done a great job adding value with their acquisitions. Not a cheap stock, but has lagged the market in the last year or 2, and hasn’t gone up at the pace that it had historically. He is starting to pay a bit more attention to this. At the right price, it is something he definitely would buy.

(A Top Pick Aug 29/16. Down 9%.) At that time, they were acquiring CFT Brands. The deal has been delayed until the 2^nd quarter. This is a secular grower. They will ultimately get approval from the competition Bureau and the US authorities, and it will be accretive to earnings.

One of Canada’s best companies. This is because everybody has recognized what a great company it really is. The only problem is that it is kind of rich, but not too rich. It’s like buying a really nice house. You have to pay more for it.

A great business. The chart shows it has had a steep rise, but more recently it has been flat. Feels the market is trying to figure out which direction the business is going, and the next chapter of growth. At 20X PE along with an acquisition to digest, you are better off missing the 1^st few innings, and coming in once that acquisition has started to digest. Historically acquisitions don’t go very well, especially at the beginning.

This basically owns convenience stores and gas stations globally. There are up to around 13,000-14,000 different entities between Canada, the US and Europe. An acquisition oriented company. The stock came down a little in the last quarter, because their earnings were not that solid because of some integration issues with Esso and 2 other brands they bought. He thinks those will go away and they will be back on the path of growth. Dividend yield of 0.6%. (Analysts’ price target is $74.)

(A Top Pick Aug 29/16. Down 9%.) Had just announced their largest acquisition at the time, which is going to be quite accretive. Enthusiasm has waned as there has been a slight delay in the closing of the transaction. This company manages to grow earnings at a 20% clip year in and year out. Trading at about 16 or 17 times earnings. Dips on this are a buying opportunity. The growth is on track.