Hibernate and Metabolize After Every Kill

“After purchasing Circle K in 2003, Couche-Tard’s sizeable appetite seemed to be satiated. It was time for the bear, amply fattened up, to hibernate in its cave and metabolize some of the abundant mass it had taken on. To reduce the weight of its debt, Couche-Tard would shed some of its less profitable stores, and hundreds of real estate properties.”

“The share price for the company, as was the case for many other companies, took a beating during this period, although Couche-Tard took on very little debt. In fact, its value neared a record low in proportion to profits. This prompted management to launch a massive share buy-back program. In two years, Couche-Tard acquired 20 million of its own shares at an average value of $14 per share, then delisted them, thus increasing shareholder equity. This time, to weather the storm, the Couche-Tard founders were placing their bets…on Couche-Tard.”