Casey’s Uptrend Remains Strong—New Highs on the Horizon
Casey’s General Stores (NASDAQ: CASY) uptrend will continue because the FQ3 results affirm the near and long-term outlook, causing the share price to spike more than 5% and confirm support at a critical level.
The critical level aligns with prior highs, a recent low, and the long-term 150-day EMA, a trend indicator. The EMA is pointing up, and the trend is up, with new highs in sight.
The near-term outlook is for a rise to retest the current highs, with new highs to follow soon after; the long-term outlook is for this stock to rise steadily over the coming years and sustain a double-digit compound annual total return.
Casey’s Outperforms in Both Operating Segments, Outlook Improves
Casey’s had a fantastic FQ3 2025 with strength in both the inside and outside retail segments, contributing to outperformance. The company’s $3.9 billion in consolidated revenue is up 17.1% annually, driven by organic growth and acquisitions, outpacing MarketBeat’s reported consensus by a solid 420 basis points. Total inside sales grew by 15%, while gasoline gallons improved by 20.4%. On a comp basis, inside sales rose by 3.7%, driven by food, hot items, and the bakery, while comp gallons increased by 1.8%.
Margin news is also favorable to shareholders. The news is mixed with inside margin contracting and outside expanding. Still, both were better than forecast by analysts, leaving net income and GAAP earnings flat compared to the expectation for decline. Among the factors impacting the earnings are the acquisition of Fike’s and its integration into the network, one time costs that synergistic efficiencies will follow. Casey’s guidance is also favorable to investors. The company maintained its comp-store growth target of 3% to 5% but increased the outlook for FY EBITDA growth by 100 bps to 11%.
Sell-Side Trends Support the Uptrend in Casey’s Share Price
The sell-side trends, including institutions, analysts, and short-sellers, are positive and support the uptrend in Casey’s General Stores stock. Analysts' trends include increased coverage at the end of 2024, a firm Moderate Buy rating with a bullish bias, and a rising price target. The consensus offers only a 5% upside in early March.
Still, it is up 37% in twelve months, and the latest revisions, including the post-release activity, are leading to the high-end range of analysts’ targets. That forecasts about a 7.5% upside for this stock, sufficient to set a new all-time high when reached, and the positive revision trend will likely continue as the year progresses.
Institutional trends are equally bullish, reverting to buying from selling in Q3 and ramping in Q4 and Q1 of 2025. The Q1 2025 activity set a multiyear high, and bulls netted more than $0.5 billion in shares, worth about 3.35% of the market cap at $400. They own more than 70% of the stock and provide a solid tailwind in Q1 2025 aided by short sellers.
The short interest is low, relatively speaking, at 3.5%. Still, it has risen sharply in the last few reports, increasing market volatility but ultimately adding bullish fuel in the form of covering activity.
Casey’s Balance Sheet and Capital Return Are Stock Price Drivers
Casey’s suspended its share buybacks in preparation for the Fikes deal and has yet to resume them but is on track to do so soon. At the end of Q3, the highlights include increased liabilities from the acquisition offset by increased cash, receivables, inventory, property, and total assets. Total assets are up nearly $1.9 billion, about 30%, outpacing the $1.5 billion increase in liability.
Equity is up 13.2% despite the rise in debt, and leverage remains low. The long-term debt leverage is less than 1x equity, which leaves the company’s positive cash flow unimpeded and the dividend safe. The dividend yield isn’t large, about 0.5%, but it is safe and expected to grow annually with a payout ratio below 15%.
Casey’s stock price responded favorably to the news, surging more than 5% the day it was released. Although headwinds remain, the move confirms support at a critical level that aligns with long-term investors and institutional activity. Resistance at the short-term 30-day EMA capped gains and may keep the stock from advancing until macroeconomic headwinds ease and broad market sentiment improves.
