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Casey's (CASY) Unmissable Run Makes It a Hot Pick

Casey's General Stores, Inc. CASY clearly appears to be a preferred pick, given its sturdy efforts to remain on growth trajectory. The company is benefiting from its Value Creation Plan. This includes new fleet card program, price and product optimization, digital engagements comprising mobile app and online ordering capabilities, cost containment efforts as well as capital reallocation plan.

Driven by these upsides, shares of this Ankeny, IA-based company have rallied approximately 28% in the past six months, outperforming the industry’s growth of 25.5%. Also, the stock has comfortably outperformed the Retail – Wholesale sector and the S&P 500 Index that advanced 5.8% and 8.7%, respectively, in the said time frame.


Currently, the stock is hovering close to its 52-week high of 4.88. Let’s take a closer look at the aspects driving this Zacks Rank #1 (Strong Buy) stock. You can see the complete list of today’s Zacks #1 Rank stocks here.

Factors Narrating Casey's Growth Story

Casey's remains on track with its value creation plan to improve sales and profitability. Also, management is focusing on improving distribution efficiency. Management anticipates that the company’s cost-reduction initiatives are likely to result in savings of million in store-level operating expenditures by fiscal 2021.

The company launched the new Casey’ e-commerce website, rolled out new mobile app, initiated fuel price optimization platform across all outlets and will soon begin the process to launch loyalty program. At the end of fiscal 2019, the new fleet card program had more than 2,000 active cards and 500 new accounts.

Casey's fleet card program, which involves managing and monitoring of initial sales, back-end system processing, billing and other consumer-oriented services, is likely to lift fuel sales. The company’s digitization efforts will help create a seamless shopping experience online as well as in-store, and facilitate same-store sales growth.

Further, its price and product optimization strategy will help augment sales and fuel margin. Management reaffirmed fiscal 2020 fuel margin forecast of 20.5-22.5 cents per gallon. The same was 20.3 cents in fiscal 2019.

All said, we are optimistic that Casey’s growth plans will help keep its stellar show on.

3 More Stocks to Watch

Burlington Stores BURL has a long-term earnings growth rate of 15.7% and carries a Zacks Rank #2 (Buy).

Costco COST has a long-term earnings growth rate of 8.5%. The stock carries a Zacks Rank #2.

Target Corp. TGT has a long-term earnings growth rate of 7.1% and a Zacks Rank #2.

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Casey's General Stores, Inc. (CASY): Free Stock Analysis Report
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Costco Wholesale Corporation (COST): Free Stock Analysis Report
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