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Why You Should Bet on Sunoco (SUN) Ahead of Q1 Earnings
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Investors are probably closely monitoring Sunoco LP (SUN - Free Report) as it prepares to announce first-quarter 2024 earnings on May 8, before the opening bell. Some are considering whether to buy units of this master limited partnership before its earnings release or wait for a more favorable entry opportunity.
Optimal Moment for Investment
Being one of the leading distributors of motor fuel to approximately 10,000 convenience stores, independent dealers, commercial customers and distributors, Sunoco derives stable cashflows, depicting a strong business model.
The partnership intends to enhance its long-term growth prospects through the acquisition of NuStar in an all-equity deal valued at around $7.3 billion, encompassing assumed debt. With the deal slated to conclude in the second quarter of 2024, Sunoco anticipates diversifying its business by integrating two resilient and strong operations. This acquisition is poised to not only lead to distribution growth but also fortify its financial position.
Although Sunoco has been underperforming the Zacks Oil - Energy sector since the beginning of 2024, the positive developments and growth prospects will likely aid it in reversing the pullback. The stock has declined 6.4% year to date against the sector's rise of 8.3%.
What’s in Store This Earnings Season?
The Zacks Consensus Estimate for first-quarter earnings per share stands at $1.06, with revenues estimated at $5.13 billion.
Notably, our proven model does not predict an earnings beat for SUN this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here. The partnership has an Earnings ESP of 0.00% and a Zacks Rank #2.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Conclusion
Investors may find it advantageous to purchase the stock before May 8, given its strategic acquisition deal and strong and sustainable business model.
Performance of Energy Giants in Q1
Exxon Mobil Corporation (XOM - Free Report) and Chevron Corporation (CVX - Free Report) are the two integrated energy giants that reported first-quarter earnings last week. While ExxonMobil missed the Zacks Consensus Estimate for earnings in the first quarter, Chevron beat the consensus estimate for the same.
One of the largest integrated energy firms,Shell plc (SHEL - Free Report) , has also reported earnings. It said that it has once again achieved a quarter marked by robust financial and operational performance. Apart from reducing emissions, Shell is showcasing its strong commitment to generating handsome value for shareholders.
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Why You Should Bet on Sunoco (SUN) Ahead of Q1 Earnings
Investors are probably closely monitoring Sunoco LP (SUN - Free Report) as it prepares to announce first-quarter 2024 earnings on May 8, before the opening bell. Some are considering whether to buy units of this master limited partnership before its earnings release or wait for a more favorable entry opportunity.
Optimal Moment for Investment
Being one of the leading distributors of motor fuel to approximately 10,000 convenience stores, independent dealers, commercial customers and distributors, Sunoco derives stable cashflows, depicting a strong business model.
The partnership intends to enhance its long-term growth prospects through the acquisition of NuStar in an all-equity deal valued at around $7.3 billion, encompassing assumed debt. With the deal slated to conclude in the second quarter of 2024, Sunoco anticipates diversifying its business by integrating two resilient and strong operations. This acquisition is poised to not only lead to distribution growth but also fortify its financial position.
Although Sunoco has been underperforming the Zacks Oil - Energy sector since the beginning of 2024, the positive developments and growth prospects will likely aid it in reversing the pullback. The stock has declined 6.4% year to date against the sector's rise of 8.3%.
What’s in Store This Earnings Season?
The Zacks Consensus Estimate for first-quarter earnings per share stands at $1.06, with revenues estimated at $5.13 billion.
Notably, our proven model does not predict an earnings beat for SUN this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here. The partnership has an Earnings ESP of 0.00% and a Zacks Rank #2.
You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Conclusion
Investors may find it advantageous to purchase the stock before May 8, given its strategic acquisition deal and strong and sustainable business model.
Performance of Energy Giants in Q1
Exxon Mobil Corporation (XOM - Free Report) and Chevron Corporation (CVX - Free Report) are the two integrated energy giants that reported first-quarter earnings last week. While ExxonMobil missed the Zacks Consensus Estimate for earnings in the first quarter, Chevron beat the consensus estimate for the same.
One of the largest integrated energy firms,Shell plc (SHEL - Free Report) , has also reported earnings. It said that it has once again achieved a quarter marked by robust financial and operational performance. Apart from reducing emissions, Shell is showcasing its strong commitment to generating handsome value for shareholders.