Caseys General Stores Inc. Earnings: Shrinking Margins for Fifth Consecutive Quarter, but Net Income Rises

Caseys General Stores Inc. (NASDAQ:CASY) reported its results for the third quarter. Casey’s General Stores and its wholly owned subsidiaries operate convenience stores under the names “Casey’s General Store,” “HandiMart” and “Just Diesel” in nine Midwestern states, mainly Iowa, Missouri, and Illinois.

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Caseys General Stores Earnings Cheat Sheet for the Third Quarter

Results: Net income for Caseys General Stores Inc. rose to $16.7 million (43 cents per share) vs. $12.9 million (34 cents per share) in the same quarter a year earlier. This marks a rise of 29.7% from the year-earlier quarter.

Revenue: Rose 14.9% to $1.58 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: The mean estimate for Caseys General Stores Inc. was 44 cents per share. It fell short of the average revenue estimate of $1.65 billion.

Quoting Management: “The solid third quarter results continue to demonstrate that Casey’s is executing well on our strategic plan,” said President and CEO Robert J Myers. “We are expanding our footprint in our current market as well as the development of new states.”

Key Stats:

The company has enjoyed double-digit year-over-year percentage revenue growth for the past five quarters. Over that span, the company has averaged growth of 27.8%, with the biggest boost coming in the first quarter when revenue rose 37.6% from the year earlier quarter.

Last quarter was the fifth in a row that the company saw shrinking gross margins, as they fell 0.3 percentage point from the year-earlier quarter to 14.5%. Over that time, margins have contracted on average 1.7 percentage points per quarter on a year-over-year basis.

The company has now seen its net income increase for three consecutive quarters. In the second quarter, net income rose 73.5% and in the first quarter, the figure rose 5.6%.

Looking Forward: The outlook for the company’s results in the upcoming quarter is unfavorable. The average estimate for the fourth quarter is 65 cents per share, down from 66 cents ninety days ago. At $3.09 per share, the average estimate for the fiscal year has fallen from $3.11 ninety days ago.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com