Alimentation Couche-Tard: 18% Compounding And 26% Dividend Growth, Cheaper Than The Index

Summary

• Alimentation Couche-Tard (ACT) has shown impressive growth, trading at ~CAD 77 from CAD 0.18 in 1996, with a CAGR of ~24% over 28 years.
• ACT's stock CAGR over the last 10 years is 18% in CAD and 16% in USD, with dividends growing at a CAGR of ~26%.
• ACT trades at a trailing P/E ratio of ~20, lower than the S&P 500, making it an attractive investment despite its premium valuation.
• The fragmented convenience store market offers ACT significant consolidation opportunities, with ongoing negotiations to acquire Seven & I Holdings and frequent smaller acquisitions.
• Strong cash flows provide dividend growth, regular buybacks, acquisitions for cash, and deleveraging once necessary simultaneously.

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Alimentation Couche-Tard ("ACT") (ATD:CA) (OTCPK:ANCTF) is a Canadian company operating convenience stores ("CS") with road fuel stations primarily in the US, Canada, and Europe. Worldwide, the network comprises ~16,800 stores including company stores (10.5K), company-operated dealer-owned stores (1.4K), dealer-owned dealer-operated stores (1.5K), and 2,300 licensed stores in 16 countries

Analyst’s Disclosure:I/we have a beneficial long position in the shares of ATD:CA either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.