Casey's General Stores (NASDAQ: CASY) operates,
or franchises, more than 1,450 mid-western convenience stores, mostly in Illinois, Iowa, and Missouri. The outlets sell beverages, gasoline, groceries and prepared foods. Casey's also carries tobacco, health and beauty aids, automotive products, ammunition, housewares and photo supplies.
The firm had good news for investors earlier in the month, when it announced fiscal Q4 EPS of 28 cents and revenues of $1.2 billion. Analysts were expecting 25 cents and $1.19 billion. Management also presented an aggressive series of operating and financial goals for the new fiscal year and the board approved a 15% increase in the quarterly dividend.
The issue
jumped through 30-day, 50-day and 90-day moving average resistance on the news and is now defining a bullish "flag" consolidation pattern. Stocks frequently exit flags moving in the same direction they were traveling on entry. In this case, that would be to the upside.
Brokers recommend the shares with one "strong buy", four "holds" and one "sell". Analysts see a 13% average annual growth rate, through the next five years. The CASY P/E ratio (14.51), Price to Sales ratio (0.25), Price to Book ratio (1.89), Price to Cash Flow ratio (8.02) and Sales Growth rate (20.09%) compare favorably with industry, sector and S&P 500 averages. Institutions hold about 96% of the outstanding shares. The stock is one of those used to calculate the S&P 600 SmallCap Index. Over the past 52 weeks, it has traded between $19.97 and $31.39. A stop-loss of $21.25 looks good here.
Larry Schutts is a contributing editor for Theflyonthewall.com and the Vice-President of Stockwinners.com. He does not hold a position in the stock discussed above.
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