Back in 2010 the The New York Times printed an article that stated " Casey's General Stores announced on Tuesday that it had received a $40-a-share offer from an unnamed bidder," In the article, the newspaper was referring to 7-Eleven's attempted acquisition of Casey's General Stores (NASDAQ:CASY).
Fortunately for shareholders of Casey's, the offer was rejected. Between stock price appreciation and dividends, Casey's General Stores has since risen nearly 80%. And based on these trends, the food and fuel company seems to have plenty of gas left for further gains.
The foot-long results
Many gas-station type super-convenience stores are starting in many cases to almost put 7-Eleven to shame by aggressively upping the ante when it comes to food. Casey's General Stores sells hamburgers, wings, pasta, whole pizzas, made-to-order subs, and all sorts of similar hot, freshly prepared American foods.
On June 9, Casey's General Stores reported fiscal full-year 2014 results for the period ended in April. Since the fuel and convenience store business is highly seasonal, it is important to look at a business like this on a full-year basis rather than just any one quarter, even though each quarter throughout the year showed amazing growth.
Total revenue for the year rose 6.1% to $1.9 billion. Same-store sales on fuel inched up 3.1%, on merchandise expanded 7.4%, and for prepared food and fountain drinks soared 11.8%. The prepared-food business explosion continued a trend where it popped 14.3% for 2012 and 8.6% for 2013. Earnings per share leaped 21% to $3.46 per diluted share.
Gather around this
The results contributed to the semi-restaurant chain known as Casey's General Stores attaining the No. 5 spot of fastest-growing national restaurant chains, according to Nation's Restaurant News. According to the firm, the key to Casey's growth is the made-from-scratch pizza. It claims that the stores capitalize on the "mom-and-pop" shop feel in small towns where it's growing in popularity as a gathering place.
Robert J. Myers, CEO of Casey's General Stores, said: "Our sales continue to benefit from expanding operations to 24-hours a day, adding pizza delivery, and completing major remodels." No wonder the company grew even during bad weather. For those who couldn't make it to Casey's for a pizza, Casey's in many cases came to them.
Expanding both kinds of dough
Casey's General Stores plans to increase its store count by between 4% and 6% per year on top of its more than 1,800 current locations. It got a mini jump-start already for this new fiscal year, as it acquired the 24 Stop-n-Go chain in May.
Casey's General Stores already has 27 more stores under construction and 38 new additional sites secured. Add those all up, and the company is already at 5% coming between now and its fiscal year ending in April of next year. It may very well top its annual goal.
Within current stores, Casey's plans to expand same-store sales of fuel by 1%, merchandise by 5.3%, and fresh food sales by 9.5%. Wow. I'm not sure I've ever seen a restaurant chain give such aggressive same-store sales guidance a year out. If the company's goals are achieved, expect to see Casey's General Stores in the top 10 again with next year's report -- only it may just inch a couple of notches higher. Regardless, Casey's General Stores are definetely worth a closer look by Fooli
Nickey Friedman has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.