Casey's General Store Financial Ratios

Corporate Finance
Casey’s General Store Financial Analysis Report
Kimberly Daily

Summary
Casey’s General Store is a convenience store who takes pride in serving their made-from-scratch pizza, sandwiches, appetizers, and more for delivery or pickup. Casey’s also provides its customers with fuel including diesel, premium and regular gas. Casey’s General Store has been around since 1968, after opening their first store in Boone, Iowa. After twenty years in the business it became a publicly traded company in 1983 and started making their infamous made-from-scratch pizzas in 1984. This is where the company began expanding more and there are currently 2,315 Casey’s General Stores that reside in 16 states. Most recently in the year 2020, Casey’s

I have written a short evaluation of each ratio listed after each ratio explaining if the average of the ratios over the previous four years are relatively good or relatively bad. The first significant trend that I noticed was found within the inventory turnover ratio. I noticed that within the past four years the ratios have stayed fairly consistent. Casey’s inventory turnover ratio is fairly high which exhibits that they are not having trouble selling their products. In fact, they sell and replenish at a high rate. This can potentially be a problem if they were to understock the shelves and not have enough inventory for customers to purchase, but they have been doing a great job with this overall. The next major trend I noticed was that their total debt ratio was higher than investors like to see. The ratio has declined over the past for years by only 3%, but it is still considered high. The total debt ratio shows us the company’s total debt, as a percentage of its total assets. Casey’s total debt ratio is hovering around 60% which is concerning for future investors. I think this could possibly be caused by Casey’s planned growth. In order to build more stores, they might have been taking out large amounts of loans. This could potentially affect future investors' decision whether or not to lend them money because investors like to know that you are able to repay them. The last significant change that I noticed was found in the quick ratio. As you can see above these ratios are significantly low, not including a spike in 2021. The quick ratio tells us how quickly Casey’s can convert their assets into cash to pay for their short-term liabilities. I think this could also be attributed to Casey’s goal to grow. The non-liquid assets could be hung up in land or real estate investments. This could potentially backfire if Caseys needed cash quickly in case of an