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Has Casey's General Stores, Inc. (NASDAQ:CASY) Improved Earnings Growth In Recent Times?

Simply Wall St
·3 mins read

In this commentary, I will examine Casey's General Stores, Inc.'s (NasdaqGS:CASY) latest earnings update (31 January 2020) and compare these figures against its performance over the past couple of years, as well as how the rest of the consumer retailing industry performed. As an investor, I find it beneficial to assess CASY’s trend over the short-to-medium term in order to gauge whether or not the company is able to meet its goals, and ultimately sustainably grow over time.

See our latest analysis for Casey's General Stores

How CASY fared against its long-term earnings performance and its industry

CASY's trailing twelve-month earnings (from 31 January 2020) of US$227m has jumped 15% compared to the previous year.

Furthermore, this one-year growth rate has exceeded its 5-year annual growth average of 6.2%, indicating the rate at which CASY is growing has accelerated. What's the driver of this growth? Let's see if it is solely because of an industry uplift, or if Casey's General Stores has experienced some company-specific growth.

NasdaqGS:CASY Income Statement, March 11th 2020
NasdaqGS:CASY Income Statement, March 11th 2020

In terms of returns from investment, Casey's General Stores has fallen short of achieving a 20% return on equity (ROE), recording 14% instead. However, its return on assets (ROA) of 7.1% exceeds the US Consumer Retailing industry of 5.0%, indicating Casey's General Stores has used its assets more efficiently. Though, its return on capital (ROC), which also accounts for Casey's General Stores’s debt level, has declined over the past 3 years from 13% to 12%.

What does this mean?

Though Casey's General Stores's past data is helpful, it is only one aspect of my investment thesis. While Casey's General Stores has a good historical track record with positive growth and profitability, there's no certainty that this will extrapolate into the future. I recommend you continue to research Casey's General Stores to get a better picture of the stock by looking at:

  1. Future Outlook: What are well-informed industry analysts predicting for CASY’s future growth? Take a look at our free research report of analyst consensus for CASY’s outlook.

  2. Financial Health: Are CASY’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.

  3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the trailing twelve months from 31 January 2020. This may not be consistent with full year annual report figures.

If you spot an error that warrants correction, please contact the editor at editorial-team@simplywallst.com. This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. Simply Wall St has no position in the stocks mentioned.

We aim to bring you long-term focused research analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Thank you for reading.