Casey's General Stores Inc "Cooking Up A Solid Growth Story" (Neutral) Carden

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Casey's General Stores Inc "Cooking Up A Solid Growth Story" (Neutral) Carden

occasions beyond dinner & pizza, which

make up ~31% and ~50% of its Prepared Foods & Dispensed Beverages sales,

respectively. An example of this would be its chicken wings, which have now been rolled

out to ~850 stores. This gives it exposure in chicken, which the company noted is a $50

b QSR market, and among the fastest growing categories within QSR. Further, CASY

believes this will add a meal occasion and help it to expand share of wallet. It pointed to

some early success. Customers that buy a wings only basket tend to increase their food

order frequency by 30% after their initial purchase. Plus, when customers add wings to

pizza, they tend to see 50% larger baskets. The company highlighted how its focus on

smaller towns plays to its advantage, noting that roughly half of its stores don't have a

national pizza or wings competitor within 5 miles. Beyond that, it is expanding its day

parts occasions with more hot breakfast & lunch sandwiches, more bakery & pastry

items, and dispensed beverage options.

Casey's company owned & operated store model provides advantages vs

franchised QSRs. Given its strong kitchen-led food offering, we believe the company is

increasingly being compared to QSRs in addition to more traditional convenience stores.

The company seems to acknowledge this and provided some interesting comparisons

and takeaways during the event. It believes its company owned and operated model

provides distinct advantages over the heavily franchised QSR industry. It noted the

Casey's model provides greater control over menu items & pricing, which allows it to

better follow trends or adapt as eating habits shift, and the company has greater control