Casey's Q2 Earnings Top Estimates, Inside Same-Store Sales Grow 4%

Casey's General Stores, Inc. CASY reported second-quarter fiscal 2025 results, wherein the bottom line improved year over year and beat the Zacks Consensus Estimate. The top line declined year over year and missed the consensus mark. The company demonstrated strength in inside same-store sales, underscoring its ability to engage customers effectively.Casey’s inside same-store sales growth was propelled by the prepared food and dispensed beverage segment, with hot sandwiches and cold dispensed beverages standing out as top performers. The company also witnessed robust strong inside gross profit growth. CASY also concluded the Fikes buyout during the fiscal quarter.Casey's Quarterly Performance: Key InsightsCASY, one of the leading convenience store chains in the United States, posted quarterly earnings of $4.85 per share, which surpassed the Zacks Consensus Estimate of $4.24 and increased 14% from $4.24 reported in the prior-year period.Find the latest EPS estimates and surprises on Zacks Earnings Calendar.Casey's General Stores, Inc. Price, Consensus and EPS Surprise Casey's General Stores, Inc. price-consensus-eps-surprise-chart | Casey's General Stores, Inc. QuoteTotal revenues of $3.9 billion missed the Zacks Consensus Estimate of $4 billion and decreased 2.9% year over year.Total inside sales jumped 9% year over year to $1.47 billion in the fiscal quarter. This was due to strong performances in the prepared food and dispensed beverage categories, which included hot sandwiches and dispensed beverages, as well as non-alcoholic and alcoholic beverages in the grocery and general merchandise segment. Inside same-store sales increased 4% compared with the 2.9% rise registered in the year-ago period. We had expected inside same-store sales to grow 4.5% in the quarter under review.Insight Into CASY’s Margins & Expenses PerformanceGross profit rose 8.2% year over year to $958.6 million in the fiscal quarter. The gross margin expanded 250 basis points (bps) to 24.3%.The total inside gross profit increased 12% year over year to $619.7 million. Meanwhile, the inside margin increased 110 bps to 42.2% due to the product mix and asset protection initiatives.EBITDA increased 14.1% year over year to $348.9 million in the quarter under discussion, whereas the EBITDA margin expanded 130 bps to 8.8%. This can be attributed to higher inside and fuel gross profit, partially offset by increased operating expenses due to operating 93 additional stores.The company witnessed a rise of 5.2% in operating expenses of $609.7 million. This rise was caused by the operation of 93 additional stores compared with the same period last year, which accounted for about 4% of the increase. An additional 1% of the rise came from same-store employee expenses, where higher labor rates were partially offset by reduced same-store labor hours. We had estimated a 6.1% increase in operating expenses.Decoding CASY’s Segmental PerformancePrepared Food & Dispensed Beverage sales rose 9.2% year over year to $417.8 million, which came in line with our estimate. Same-store sales increased 5.2% compared with 6.1% in the year-ago quarter. The Prepared Food & Dispensed Beverage margin declined 30 bps to 58.7% from 59% in the year-ago period. Grocery & General Merchandise sales increased 8.8% to $1.05 billion in the fiscal quarter, surpassing our estimate of $1.04 billion. Same-store sales increased 3.6% compared with 1.7% growth in the year-ago quarter. The Grocery & General Merchandise margin grew 160 bps to 35.6% from 34% in the year-ago period.We note that Fuel sales declined 8.8% year over year to $2.41 billion in the fiscal quarter, missing our estimate of $2.44 billion. Fuel gallons sold jumped 6.2% to $775.9 million due to an increase in store count. We had anticipated an increase of 4.1% in fuel gallons sold.Fuel gallons same-store sales were down 0.6% year over year. The fuel margin decreased to 40.2 cents per gallon from 42.3 cents in the prior-year period.CASY’s Financial Snapshot: Cash, Debt & Equity OverviewCasey's, which operated 2,685 stores as of Oct. 31, 2024, ended the fiscal quarter with cash and cash equivalents of $352 million, long-term debt and finance lease obligations (net of current maturities) of $2.46 billion and shareholders’ equity of $3.34 billion. In the fiscal second quarter, the company did not repurchase any shares and has shares worth around $295 million available under its current share buyback authorization.Sneak Peek Into CASY’s OutlookCasey’s has updated its 2025 outlook, mainly due to the buyout of Fikes, which was completed on Nov. 1, 2024.For fiscal 2025, including the impact of the Fikes acquisition, management now expects EBITDA growth to be at least 10%, up from the previous rise of 8%. The company anticipates total operating expenses to increase 11-13%, revised from the earlier forecast of 6-8%. It expects to invest $550 million in fiscal 2025 compared with the previous estimation of $575 million.For fiscal 2025, Casey's still expects inside same-store sales to increase 3-5% and anticipates an inside margin to be comparable with fiscal 2024. Management foresees same-store fuel gallons sold between negative 1% and positive 1%. The company anticipates opening about 270 stores in fiscal 2025.Shares of this Zacks Rank #3 (Hold) company have gained 11.9% in the past three months compared with the industry’s 8.7% growth.Image Source: Zacks Investment ResearchStocks to ConsiderIngredion Incorporated INGR manufactures and sells sweeteners, starches, nutrition ingredients and biomaterial solutions derived from wet milling and processing corn and other starch-based materials. The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.INGR delivered a trailing four-quarter earnings surprise of 9.5%, on average. The Zacks Consensus Estimate for Ingredion’s current-financial year’s earnings indicates growth of 12.4% from the year-ago reported number.Freshpet Inc. FRPT manufactures, distributes and markets natural fresh meals and treats for dogs and cats. It currently carries a Zacks Rank #2 (Buy). FRPT delivered a trailing four-quarter earnings surprise of 144.5%, on average.The Zacks Consensus Estimate for Freshpet’s current financial-year sales and earnings indicates growth of 27.3% and 228.6%, respectively, from the prior-year reported levels.US Foods Holding Corp. USFD engages in marketing, sale and distribution of fresh, frozen and dry food and non-food products to foodservice customers in the United States. It currently carries a Zacks Rank #2. USFD delivered an earnings surprise of 3.7% in the last reported quarter.The Zacks Consensus Estimate for US Foods Holding’s current fiscal-year sales and earnings indicates growth of 6.4% and 18.6%, respectively, from the prior-year reported levels.Zacks Naming Top 10 Stocks for 2025Want to be tipped off early to our 10 top picks for the entirety of 2025?History suggests their performance could be sensational.From 2012 (when our Director of Research Sheraz Mian assumed responsibility for the portfolio) through November, 2024, the Zacks Top 10 Stocks gained +2,112.6%, more than QUADRUPLING the S&P 500’s +475.6%. Now Sheraz is combing through 4,400 companies to handpick the best 10 tickers to buy and hold in 2025. Don’t miss your chance to get in on these stocks when they’re released on January 2.Be First to New Top 10 Stocks >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Freshpet, Inc. (FRPT): Free Stock Analysis Report Ingredion Incorporated (INGR): Free Stock Analysis Report Casey's General Stores, Inc. (CASY): Free Stock Analysis Report US Foods Holding Corp. (USFD): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks