Luis Alvarez/DigitalVision via Getty Images Investment Action I upgraded Alimentation Couche-Tard Inc. ( ATD:CA ) to a buy rating previously, as I thought the setup looked much better than in Q1 2026, with better merchandise growth, stable fuel margins, and also the restart of capital returns to shareholders. The Q3 2026 results showed us better US same-store merchandise growth, stronger fuel marg...
Luis Alvarez/DigitalVision via Getty Images Investment Action I upgraded Alimentation Couche-Tard Inc. ( ATD:CA ) to a buy rating previously, as I thought the setup looked much better than in Q1 2026, with better merchandise growth, stable fuel margins, and also the restart of capital returns to shareholders. The Q3 2026 results showed us better US same-store merchandise growth, stronger fuel margins across all geographies, continued traction in food, and improving demand across other categories like nicotine and energy drinks. All of these make the earnings growth story look better than I thought. Latest Quarter Results Total revenue for Q3 2026 saw a growth of 4.3% y/y, coming in at $21.8 billion. Within it, merchandise and service revenue was $5.8 billion, up 8.7%, while road transportation fuel revenue was $15.9 billion, up 2.8%. Other revenue was $196.5 million, up 2.2%. Inside the store, same-store merchandise revenue grew 2.8% in the US, 0.4% in Europe and other regions, and 0.3% in Canada, which drove consolidated same-store merchandise growth to 2%. In road transportation fuel, same-store volumes fell 0.4% in the US and 1.6% in Europe and other regions, while Canada grew 4.2%. Merchandise and service gross profit was $2 billion, up 8.6%, while road transportation fuel gross profit was $2.17 billion, up 16.9%. By region, US merchandise and service gross profit came in at $1.32 billion, up 7.9%; Europe and other regions saw $464.6 million, up 14.9%, while Canada saw $218 million, up 1.1%. As for road transportation, US fuel gross profit was $1.39 billion, up 15.2%. Europe and other regions saw $574.2 million, up 18.8%, and Canada saw $205.5 million, up 23.6%. Although the headline revenue growth figure was not exciting, total gross profit performance was great, growing by 12.5% y/y to $4.24 billion. Combined with lower opex growth, EBIT came in at $1.14 billion, up 18.2%. This translated into ~19% adj. EPS growth. US Convenience Recovery and Fuel Margins Base...