Market reaction to fiscal 4Q17 results
As Casey’s General Stores (CASY) failed to meet expectations with its fiscal 4Q17 results, the company’s stock price fell 8.5% and closed at $106.66 on June 6, 2017. The company is now sitting at a year-to-date (or YTD) loss of 10%.
In comparison, CST Brands (CST) and Murphy USA have stayed in the green with YTD gains of 0.4% and 10.2%, respectively.
Wall Street recommendations
There were not much of analyst action after Casey’s General Stores’ results. The company, which is covered by 13 Wall Street analysts, received 46% “buy” ratings and 54% “hold” ratings. There are no “sell” ratings yet.
Casey’s General Stores’ target price was revised by BMO on June 7 from $116 to $110. The broker, however, maintained its “market perform” rating on the stock.
The average target price for CASY stock is $120.92. This indicates an upside potential of ~13% over the next 12 months.
Casey’s General Stores has received a rating of 2.4 on a scale of 1 (strong buy) to 5 (sell). Its ratings have worsened over the last two to three months. The company was rated 1.8 in February, 2.1 in March, and 2.2 at the beginning of May. In our view, the company’s weak financial performance can be seen as the key reason behind the downgrade.
Casey’s General Stores (CASY) is currently trading at a one-year forward PE (price-to-earnings) ratio of 22.7 versus its three-year average of 21.0x. The company recently touched the upper end of its 52-week PE range of 19.0x–24.8x.
The retailer continues to be cheaper in relation to CST Brands (CST), which is trading at 28.8x. Murphy USA, however, sells at a discount and is valued at 16.5x.
Investors looking for exposure to CASY through ETFs can consider the iShares S&P Mid-Cap 400 Value ETF (IJJ). CASY makes up 0.5% of IJJ.