November 14, 2024
Top 10 Stock Casey's Strong Buy Recommendation

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For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).

360° View: Obermatt 360° View Casey's Strong Buy

360 METRICS	November 14, 2024
VALUE
VALUE	17
GROWTH
GROWTH	81
SAFETY
SAFETY	94
SENTIMENT
SENTIMENT	61
360° VIEW
360° VIEW	79

ANALYSIS: With an Obermatt 360° View of 79 (better than 79% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Casey's are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Casey's. The consolidated Growth Rank has a good rank of 81, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. This means that growth is higher than for 81% of competitors in the same industry. The consolidated Safety Rank at 94 means that the company has a financing structure that is safer than 94% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 61, which means that professional investors are more optimistic about the stock than for 61% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 17, meaning that the share price of Casey's is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 83% of alternative stocks in the same industry. ...read more

RECOMMENDATION: With a consolidated 360° View of 79, Casey's is better positioned than 79% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 81), a safe financing structure (Safety Rank of 94), and positive professional market sentiment (Sentiment Rank of 61), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Casey's compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (81% better than peers). The value rank could be the reverse reflection of that (19%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more

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Sentiment Strategy: Professional Market Sentiment for Casey's positive

SENTIMENT METRICS	November 14, 2024
ANALYST OPINION
ANALYST OPINION	80
OPINIONS CHANGE
OPINIONS CHANGE	59
PRO HOLDINGS
PRO HOLDINGS	45
MARKET PULSE
MARKET PULSE	42
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	61

ANALYSIS: With an Obermatt Sentiment Rank of 61 (better than 61% compared with alternatives), overall professional sentiment and engagement for the stock Casey's is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Casey's. Analyst Opinions are at a rank of 80 (better than 80% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 59 which means that currently, stock research experts are getting even more optimistic about investments in Casey's. But Market Pulse has a low rank of 42, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 58% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 45, which means that, currently, professional investors hold less stock in this company than in 55% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more

RECOMMENDATION: With a consolidated Sentiment Rank of 61 (more positive than 61% compared with investment alternatives), Casey's has a reputation among professional investors that is above-average compared with that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more

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Value Strategy: Casey's Stock Price Value low

VALUE METRICS	November 14, 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	30
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	22
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	26
DIVIDEND YIELD
DIVIDEND YIELD	42
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	17

ANALYSIS: With an Obermatt Value Rank of 17 (worse than 83% compared with alternatives), Casey's shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Casey's. Price-to-Sales is 30 which means that the stock price compared with what market professionals expect for future profits is higher than 70% of comparable companies, indicating a low value concerning Casey's's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 26, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Casey's. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 22 and Dividend Yield, which is lower than 58% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 17, is a sell recommendation based on Casey's's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Casey's? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Casey's? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Casey's may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more

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Growth Strategy: Casey's Growth Momentum high

GROWTH METRICS	November 14, 2024
REVENUE GROWTH
REVENUE GROWTH	83
PROFIT GROWTH
PROFIT GROWTH	65
CAPITAL GROWTH
CAPITAL GROWTH	32
STOCK RETURNS
STOCK RETURNS	81
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	81

ANALYSIS: With an Obermatt Growth Rank of 81 (better than 81% compared with alternatives) for 2024, Casey's shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Casey's. Sales Growth has a rank of 83 which means that currently, professionals expect the company to grow more than 83% of its competitors. Both Profit Growth, with a rank of 65, and Stock Returns, with a rank of 81, are also above average. But Capital Growth only has a rank of 32, which means that, currently, professionals expect the company to grow its invested capital less than 68% of its competitors. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 81, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. ...read more

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Safety Strategy: Casey's Debt Financing Safety very solid

SAFETY METRICS	November 14, 2024
LEVERAGE
LEVERAGE	76
REFINANCING
REFINANCING	45
LIQUIDITY
LIQUIDITY	76
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	94

ANALYSIS: With an Obermatt Safety Rank of 94 (better than 94% compared with alternatives) for 2024, the company Casey's has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Casey's is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Casey's. Leverage is at a rank of 76, meaning the company has a below-average debt-to-equity ratio. It has less debt than 76% of its competitors. Liquidity is also good at a rank of 76, meaning the company generates more profit to service its debt than 76% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 45, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 55% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 94 (better than 94% compared with alternatives), Casey's has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Casey's. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more

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Combined financial peformance: Casey's Top Financial Performance

COMBINED PERFORMANCE	November 14, 2024
VALUE
VALUE	17
GROWTH
GROWTH	81
SAFETY
SAFETY	76
COMBINED
COMBINED	77

ANALYSIS: With an Obermatt Combined Rank of 77 (better than 77% compared with investment alternatives), Casey's (Food Retail, USA) shares have much better financial characteristics than comparable stocks. Shares of Casey's are low in value (priced high) with a consolidated Value Rank of 17 (worse than 83% of alternatives). But they show above-average growth (Growth Rank of 81) and are safely financed (Safety Rank of 94, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 77, is a strong buy recommendation based on Casey's's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Casey's exhibits low value (Obermatt Value Rank of 17), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 81). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 94) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more

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