CASY Q2 Earnings Beat Estimates, Inside Sales Rise Y/Y, FY26 View Up

Casey’s reported fiscal Q2 results with adjusted EPS of $5.53, beating the Zacks $4.92 estimate and rising 14% year-over-year, while revenue of $4.506 billion missed consensus but grew 14.2% YoY; inside sales jumped 13% (inside same-store +3.3%) and fuel sales rose 11.3% with gallons up 16.8% (same-store +0.8%) and fuel margin improving to $0.416/gal. Margins expanded as gross profit climbed to $1.12 billion (+17%) and gross margin widened 60 bps to 24.9%, with EBITDA up 17.5% to $410.1 million and an EBITDA margin of 9.1%, though operating expenses increased 16.7% mainly from 236 new stores; the chain now operates 2,921 stores. Management raised fiscal-2026 EBITDA guidance to 15–17% (from 10–12%), plans ~$600 million of capex, expects inside same-store sales growth of 3–4% and same-store fuel gallons roughly flat, will add ~80 stores this year toward a three-year 500-store target, and returned capital via a $31 million buyback and a $0.57 quarterly dividend—actions that underscore confidence in cash flow and growth execution despite the revenue miss.

Analysis

Casey’s reported fiscal Q2 results with adjusted EPS of $5.53, beating the Zacks consensus of $4.92 and rising 14% year-over-year, while total revenue of $4,506.1 million missed the $4,553 million consensus but grew 14.2% versus the prior year. Inside sales jumped 13% to $1.66 billion (inside same-store +3.3% versus an expected +3.1%), and fuel gallons sold rose 16.8% to 906.7 million with same-store gallons up 0.8%, supporting an improved fuel margin of $0.416/gal.

Gross profit increased 17% to $1.12 billion and gross margin expanded 60 basis points to 24.9%; EBITDA rose 17.5% to $410.1 million and EBITDA margin expanded 30 bps to 9.1%, while operating expenses grew 16.7% to $711.6 million driven primarily by 236 net new stores. The company finished the quarter with $492 million cash, $2.35 billion long-term debt and finance leases, repurchased ~$31 million of stock (with ~$233 million remaining authorization), and declared a $0.57 quarterly dividend.

Management raised fiscal-2026 EBITDA guidance to 15–17% (from 10–12%), plans ~$600 million of capex, expects inside same-store sales growth of 3–4% and same-store fuel gallons roughly flat, and intends to open ~80 stores this year as part of a three-year 500-store target. The combination of margin expansion and upgraded guidance signals operational momentum in prepared foods and fuel, but the revenue miss, rising operating expenses from store growth and sizeable capex and debt requirements present execution and capitalization risks that warrant monitoring.

Key Decisions for Investors

• Consider maintaining or modestly increasing exposure to CASY given the EPS beat, margin expansion and raised EBITDA guidance, while sizing position to reflect $600 million planned capex and $2.35 billion of long-term debt
• Monitor two near-term indicators—inside same-store sales trends and same-store fuel gallons—because weakening momentum or continued above-plan operating expense growth would justify trimming the position
• View the $31 million buyback, $233 million remaining authorization and steady $0.57 quarterly dividend as partial downside support; consider hedging large positions around execution and capex risk