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Casey's General (CASY) is trading modestly lower after reporting its Q2 (Oct) results last night. The company comfortably beat EPS expectations, extending its streak of large double-digit upside, while revenue increased 14.2% yr/yr to $4.51 bln, an acceleration from Q1, but was just in line with expectations. Casey's also raised its FY26 EBITDA growth target to +15-17% from +10-12% and tightened its inside same-store sales outlook to +3-4% from +2-5%, effectively reaffirming the midpoint.

• Inside same-store sales increased +3.3% (+4.3% in Q1), underpinned by an increase in guest traffic as customers responded to CASY's value proposition.
• This was driven by a +4.8% (+5.6% in Q1) inside comp in the prepared food & dispensed beverages segment, while Grocery & General Merchandise inside comp came in at +2.7% (+3.8% in Q1).
• Inside margin improved 20 bps to 42.4%, with prepared food at 58.6% (+60 bps) and grocery at 36% (+10 bps).
• Fuel performance was impressive, marking its fourth consecutive quarter of fuel gallon growth, with same-store gallons up +0.8% and fuel margin expanding to about $0.416 per gallon from $0.410.
• Management described consumer sentiment as cautious but behavior as healthy, noting that guests intend to maintain visit frequency and that traffic and same-store sales remain solid as value-conscious customers increasingly choose Casey's prepared food over higher-priced QSR options.

Briefing.com Analyst Insight

This was another strong quarter for CASY. Inside comps were a bit softer than Q1 but still healthy, showing customers are still responding to Casey's value proposition. Additionally, top-line growth accelerated, margins moved higher in key high-margin categories, and fuel once again delivered both gallon growth and higher cents-per-gallon in a tougher backdrop. While CASY did raise FY26 EBITDA guidance to 15-17%, we think investors may be reacting to the inside comp guidance, which was narrowed to +3-4% and effectively reaffirmed the midpoint rather than pushing expectations higher. Given the strong run in the stock and strong performance in the first half, some investors may have been looking for more aggressive upside. Even so, we think the increased traffic and still positive comps support the idea that its customer remains in decent shape and that the underlying business is holding up well, even if the guidance tweak was more measured than some might have hoped.