VOL. XCIV, NO. 247
★ WIDE MOAT STOCKS & COMPETITIVE ADVANTAGES ★
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Thursday, January 8, 2026
Alimentation Couche-Tard Inc.
ATD · Toronto Stock Exchange
Weighted average of segment moat scores, combining moat strength, durability, confidence, market structure, pricing power, and market share.
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Overview
Alimentation Couche-Tard is a global convenience and mobility retailer operating and licensing stores under banners such as Circle K, with a worldwide network of close to 17,000 stores as of fiscal year-end 2025. The two main revenue streams are road transportation fuel and in-store merchandise/services, with a small tail of other ancillary revenues. Its moat is mainly operational and asset-based: a dense, controlled site footprint plus a disciplined operating model that scales across geographies. Key counter-pressures are intense local price competition (especially in fuel), regulatory constraints on key categories, and long-run fuel demand headwinds from electrification.
Primary segment
Road transportation fuel (retail fuel and related mobility services)
Market structure
Competitive
Market share
—
HHI: —
Coverage
3 segments · 6 tags
Updated 2026-01-05
Segments
Merchandise and services (in-store convenience retail)
Convenience retail (in-store merchandise, prepared food, beverages, tobacco, and services)
Revenue
25.2%
Structure
Competitive
Pricing
moderate
Share
—
Peers
Road transportation fuel (retail fuel and related mobility services)
Road transportation fuel retail (gasoline/diesel) at convenience sites; includes unmanned/automated fuel stations
Revenue
74%
Structure
Competitive
Pricing
weak
Share
—
Peers
Other revenues (ancillary energy and other income streams)
Ancillary energy products and other income streams (e.g., stationary energy, aviation fuel, rentals)
Revenue
0.8%
Structure
Competitive
Pricing
weak
Share
—
Peers
—
Moat Claims
Merchandise and services (in-store convenience retail)
Convenience retail (in-store merchandise, prepared food, beverages, tobacco, and services)
Revenue share computed from FY2025 MD&A table: total merchandise and service revenues $18,359.4m of total revenues $72,856.8m (52-week period ended 2025-04-27).
Physical Network Density
Supply
Physical Network Density
Strength
Durability
Confidence
Evidence
Large, dense store network (owned/controlled and licensed) supports local convenience advantage and drives purchasing and operating leverage.
Erosion risks
- Shift of trips to delivery/quick-commerce
- Electric vehicle adoption reducing fuel-driven traffic
- Local competition replicating location coverage
Leading indicators
- Net store count change and mix (company-operated vs licensed)
- Same-store traffic / transactions
- Merchandise and service same-store sales growth
Counterarguments
- Convenience retail advantages are local; competitors can add nearby sites in many markets
- For many purchases, price and proximity outweigh brand, limiting defensibility
Operational Excellence
Supply
Operational Excellence
Strength
Durability
Confidence
Evidence
Standardized, disciplined operating model and best-practice sharing across geographies supports margin execution and acquisition integration.
Erosion risks
- Cultural dilution from rapid acquisition pace
- Labor inflation and higher turnover affecting execution
- IT/program execution risk (pricing/loyalty/operations tools)
Leading indicators
- Normalized SG&A growth vs sales growth
- Merchandise and service gross margin trend
- Post-acquisition synergy realization vs plan
Counterarguments
- Operational practices and analytics can be copied by other scaled operators
- Scale can create bureaucracy that offsets execution advantages
Brand Trust
Demand
Brand Trust
Strength
Durability
Confidence
Evidence
Global and local convenience banners (e.g., Circle K, Couche-Tard, Ingo, Holiday) support consumer preference and repeat visits, especially for higher-margin inside sales.
Erosion risks
- Brand damage from service/food safety issues
- Consumer trade-down during downturns
- Regulatory restrictions (tobacco/nicotine, alcohol) reducing key categories
Leading indicators
- Customer satisfaction / NPS where disclosed
- Brand conversion progress to Circle K
- Prepared food penetration and margin
Counterarguments
- In many markets, consumers pick based on location and price rather than banner
- Private label and food offers from rivals can narrow perceived differentiation
Road transportation fuel (retail fuel and related mobility services)
Road transportation fuel retail (gasoline/diesel) at convenience sites; includes unmanned/automated fuel stations
Revenue share computed from FY2025 MD&A table: total road transportation fuel revenues $53,904.7m of total revenues $72,856.8m (52-week period ended 2025-04-27).
Supply Chain Control
Supply
Supply Chain Control
Strength
Durability
Confidence
Evidence
Fuel supply agreements, owned/operated terminals, and distribution capabilities can improve supply assurance and delivered cost versus smaller operators.
Erosion risks
- Refining/logistics disruptions and regulatory changes
- EV adoption structurally reducing fuel volumes over time
- Competitors with equal or greater scale (integrated oil, large chains)
Leading indicators
- Fuel gross margin per gallon/liter
- Fuel volumes sold (same-store and total)
- Number of fuel terminals / supply disruptions (if disclosed)
Counterarguments
- Fuel is a commodity; cost advantages are often competed away via pump price
- Large integrated suppliers and other scaled retailers can match logistics capabilities
Physical Network Density
Supply
Physical Network Density
Strength
Durability
Confidence
Evidence
Large number of fuel-dispensing sites and automated fuel stations supports volume scale and local convenience advantage in mobility retail.
Erosion risks
- Long-run demand decline from EV adoption
- Price wars in local markets compressing margins
- Environmental regulation increasing compliance capex
Leading indicators
- Fuel volume per site
- EV charging deployment and utilization
- Same-store fuel volume trends
Counterarguments
- Fuel customers are highly price-sensitive; location and brand matter less than price
- Local competitors can often match site density in key corridors
Operational Excellence
Supply
Operational Excellence
Strength
Durability
Confidence
Evidence
Operational execution (pricing, store operations, and supply chain optimization) supports maintaining fuel gross margins through volatility.
Erosion risks
- Input cost volatility and rapid wholesale price swings
- Regulatory price controls in some jurisdictions
- Aggressive competitor discounting
Leading indicators
- Fuel gross margin per gallon/liter
- Retail-to-wholesale price lag metrics (internal)
- Share of volume at automated fuel stations
Counterarguments
- Fuel margins are strongly influenced by macro and competitor behavior, limiting company control
- Optimization gains can diminish as best practices diffuse
Other revenues (ancillary energy and other income streams)
Ancillary energy products and other income streams (e.g., stationary energy, aviation fuel, rentals)
Revenue share computed from FY2025 MD&A table: total other revenues $592.7m of total revenues $72,856.8m (52-week period ended 2025-04-27).
Scope Economies
Supply
Scope Economies
Strength
Durability
Confidence
Evidence
Small ancillary revenue streams can leverage existing assets (sites/real estate) and customer traffic, but are generally not strongly defensible on their own.
Erosion risks
- Commodity pricing and intense competition in ancillary energy products
- Low scale vs specialized operators
- Regulatory changes affecting specific products
Leading indicators
- Other revenues growth rate
- Contribution margin from ancillary categories
Counterarguments
- Ancillary categories are too small to create meaningful bargaining power or defensibility
- Specialist providers can outcompete on price and service in niche segments
Evidence
As of April 27, 2025, our network comprised 9,217 convenience stores throughout North America, including 8,202 stores with road transportation fuel dispensing.
Supports dense footprint; the same section also describes a worldwide network close to 17,000 stores including licensed Circle K sites.
Sites for which the real estate is controlled by Couche-Tard (through ownership or lease agreements) ...
Highlights that a large portion of sites are controlled via owned/leased real estate, reinforcing site permanence.
We are a customer-centric, financially disciplined organization that routinely compares best practices ... to enhance our operational expertise ...
Direct statement of an operating discipline / playbook used across the network.
These banners have an established reputation for convenience and excellence in product selection and value ...
Explicitly frames banner reputation as a differentiator.
We buy road transportation fuels ... mainly under supply agreements.
Supports structured procurement vs spot-only purchasing.
Showing 5 of 10 sources.
Risks & Indicators
Erosion risks
- Shift of trips to delivery/quick-commerce
- Electric vehicle adoption reducing fuel-driven traffic
- Local competition replicating location coverage
- Cultural dilution from rapid acquisition pace
- Labor inflation and higher turnover affecting execution
- IT/program execution risk (pricing/loyalty/operations tools)
Leading indicators
- Net store count change and mix (company-operated vs licensed)
- Same-store traffic / transactions
- Merchandise and service same-store sales growth
- Normalized SG&A growth vs sales growth
- Merchandise and service gross margin trend
- Post-acquisition synergy realization vs plan
Curation & Accuracy
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