Caseys General Store (CASY)

They have 2,900 convenience stores in 20 states. Thy dominate the small towns where they operate. They report Monday, and would buy shares before and after earnings.

No quarrel with this business. Exemplary operator. Fairly niche geographic footprint, largely in US Midwest. Often the only convenience store in town, rather than competing in larger cities. 

Instead, he owns ATD. Should ATD be successful in acquiring 7-Eleven, trade commission will likely require stores to be sold, and CASY would be the logical buyer.

He sold high. Trades at a nice PE and will likely go higher. He's not saying it's a bad stock, not at all. He sold this to buy more Adobe.

CASY is $16B market cap, up 12% this year and up 32% over 52 weeks. P/E is 31X, dividend 0.45%. Debt is about 2.5X cash flow but cash flow is good, and growing. EPS has nearly tripled since 2019. It is a well-run business and the stock is up nearly 400% in the past decade. The last quarter was solid and ahead of estimates. Same store sales rose 3.7%, though gasoline sales declined, largely due to pricing. We would be quite comfortable owning this.
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They report Tuesday. Share have flown along with good operations, which he expects to continue. Given the current valuation, he doesn't expect much upside, but remains positive.

A new holding and doesn't expect any surprises either way in this week's report.

The chart is amazing. It closed at $117.76. He has a fair market value of $124.06, a 5.8% upside. However, he wouldn’t buy it here, but would wait for a pullback to $104-$105.