Valuing Convenience
Alimentation Couche-Tard Inc. (ATD.B.TO) operates convenience stores and gas stations in the United States, Europe and Canada. Its brands include Circle K, Statoil, Kangaroo Express, Couche-Tard and Mac's. Its network consists of approximately 8,006 convenience stores across North America, including over 6,579 stores offering fuel. In Europe, it operates a retail network across Scandinavia (Norway, Sweden and Denmark), Poland, the Baltics (Estonia, Latvia and Lithuania) and Russia.
[PostStockWidget stock_valuation="" pricetype="live" manual_date="Dec. 21, 2012, 2:04pm GMT" symbolcodes="'ATD-B.TO'" symbolprices="52" div_align="right"]
We’ve had our eye on Couche Tard for a long time and have been waiting for a moment of weakness to pick up the shares.
Couche Tard has come off recently because the founders are being asked to give up their multiple voting shares in favor of regular voting shares. As such, the founders have said that they may consider selling the company if forced to convert.
We think that one way or another this high quality company will return to its high valuation.
Purple Chips 12 -18 month target: $60.00
LOW VALUATION IN ALIMENTATION COUCHE TARD AT $52.04 (ATD.B-T) FULL POSITION
PURPLE CHIPS TARGET: $60.00 POSITION SIZE: FULL (5.0%) P/E: 21.0X DIV: 0.27 (0.51%) MKT CAP: $22B Debt: $4B NOPCF per share: N/A EARNINGS YIELD: 6.0% 5 YR EPS Growth rate*:10% P/E/G Ratio: 2.1X 2016 EPS: $1.97 2017 EST.: $2.33 2018 EST.: $2.43
*Blended growth rate= 2/3 historical (5yrs), 1/3 forward.
