What happened

Shares of gas station and convenience store operator Casey's General Stores (CASY 1.76%) rose 11.7% in August, according to data provided by S&P Global Market Intelligence. That beat the S&P 500's 7% gain for the month. 

Despite tumbling in the wake of March's oil price war and coronavirus-related travel restrictions, Casey's shares have recovered since. For the year, the stock is up about 9.8%, outpacing the S&P 500's increase of around 4.1%.

A young woman fills her vehicle at a gas station.

Image source: Getty Images.

So what

Part of Casey's recovery has been prompted by the gradual reopening of states' economies. While millions of Americans are still unemployed or working from home, causing year-over-year declines in fuel demand, gasoline sales have recovered substantially from April, when many states in which Casey's operates were under stay-at-home orders. 

However, the big jump in Casey's stock occurred on Aug. 3, following the news that 7-Eleven was buying the Speedway chain from oil refiner Marathon Petroleum in a $21 billion all-cash deal. 7-Eleven will add about 4,000 Speedway gas stations and convenience stores located in 35 states to its roughly 10,000 existing U.S. convenience stores, increasing its U.S. location count by about 40%.

Even though Casey's had no part in the deal, it underscored the value of gas station/convenience store combos, and investors bid up Casey's shares in response.

Now what

The Speedway acquisition shouldn't have any direct impact on Casey's, since locations are just changing hands and not opening or closing. Of more interest to investors are Casey's record-breaking Q1 2021 earnings, which were just released yesterday. 

Diluted earnings were up 40.1% year over year to $3.24 per share, despite a 14.6% decrease in fuel gallons sold and a 19.9% drop in overall revenue, which came in at $2.1 billion. That means Casey's has done an impressive job of squeezing more profit out of its operations, even amid the pandemic. Casey's still looks like a buy.