Convenience stores have had a great run in the last few years. The chart for Casey's General Store $CASY tells the story. Murphy USA $MUSA has had a similar monster run. These convenience chains have been multi-baggers.
Yesway and its flagship brand Allsup's operate 419 convenience stores across the rural Southwest and Midwest, sell nearly 600 million gallons of fuel a year, and moved through $187 million in Adjusted EBITDA in FY 2025. The Q1 2026 preliminary numbers — $52–60 million in Adjusted EBITDA up ~100% YoY.
DEAL: 14M shares at $20-23 with a 15% shoe. $345M deal at the mid-point puts the EV at ~$2B. The banks are Morgan Stanley, JPM, Goldman, Barclays, BMO, KeyBanc, Guggenheim and RayJay.
We'll cover the more interesting and different aspects of the business, some of the "PE stank" and finally provide our stock conclusion.
Burrito Magic
Yesway was built the old-fashioned PE way — buy it, integrate it, standardize it, then go build more. The founding story is simple: Brookwood Financial (a real estate-focused PE firm) spotted the fragmentation in convenience retail in 2015 and started acquiring. Twenty-seven acquisitions later, the 2019 Allsup's deal was the transformative move — 305 stores in one transaction, a dominant brand in rural New Mexico and Texas, and a food program that the acquirer was smart enough not to touch.
After the integration hangover of 2020–2021, the company shifted gears: 90 new stores built since 2021, a deliberate deleveraging campaign, and the launch of what management calls the "2030 Build Program" — a target of 550 stores from today's 419, all in a concentrated four-state geography (Texas, New Mexico, Oklahoma, Arizona).
Today's footprint: 419 stores (net of a pending sale of 29 non-strategic Iowa and Kansas locations) across seven states, with the heaviest concentration in Texas (249) and New Mexico (127). Approximately 65% of underlying real estate is owned.
The Allsup deep-fried burrito has been a big success with 24 million sold last year. The burrito is a vivid illustration of the strategy. First of all it's appealing and cheap - two burritos and a drink for $5. Secondly it requires little in terms of labor or kitchen space.
