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Here's Why It Is Worth Investing in Sunoco (SUN) Stock Now
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Sunoco LP (SUN - Free Report) has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
The Zacks Consensus Estimate for Sunoco’s 2024 and 2025 earnings per share (EPS) is pegged at $5.07 and $4.47. SUN currently has a Zacks Style Score of A for Value and Growth, and B for Momentum.
What’s Favoring the Stock?
Sunoco operates an extensive network of approximately 9,500 miles of pipeline and more than 100 terminals, serving about 10,000 convenience stores, independent dealers, commercial customers and distributors across multiple regions. This vast and diversified operational footprint positions Sunoco advantageously in the market, allowing it to capitalize on various opportunities and mitigate regional risks.
Sunoco has reported a record first-quarter 2024 net income of $230 million, up from $141 million in the same quarter of 2023. This substantial increase in profitability showcases the partnership’s ability to generate higher earnings, which can be attributed to effective cost management and improved operational efficiency.
Sunoco has demonstrated a commitment to returning value to shareholders through a consistent increase in distributions. For the first quarter of 2024, the partnership increased its quarterly distribution by 4%, following a 2% increase in the previous year. This brings the distribution to 87.56 cents per unit, or $3.5 on an annualized basis.
Sunoco’s strategic acquisitions are poised to bolster its market position and drive growth. The acquisition of NuStar Energy L.P., completed on May 3, 2024, is particularly significant. This acquisition brings an additional 9,500 miles of pipeline, and 63 terminal and storage facilities, expanding Sunoco’s footprint and operational capabilities.
As of Mar 31, 2024, Sunoco had a liquidity of $870 million under its $1.5-billion revolving credit facility. The partnership also improved its financial flexibility by amending and extending its credit facility to May 2029. Sunoco’s issuer credit rating was raised to BB+ by S&P Global Ratings, and its Corporate Family Rating was upgraded to Ba1 by Moody’s, reflecting the partnership’s strengthened financial position and reduced credit risk.
On Apr 16, 2024, Sunoco successfully divested 204 convenience stores to 7-Eleven, Inc. for approximately $1 billion. This strategic move allows Sunoco to streamline its operations and focus on its core fuel distribution business, while enhancing its financial position through the influx of significant capital from the sale.
Sunoco has invested $41 million in capital expenditure in the first quarter of 2024, including $27 million in growth capital and $14 million in maintenance capital. These investments are crucial for sustaining and expanding the partnership’s infrastructure, ensuring long-term growth and operational efficiency.
Sunoco’s management has demonstrated strategic foresight by effectively navigating market challenges, optimizing the partnership’s asset portfolio, and focusing on high-return investments. The Zacks Rank #2 (Buy) partnership's strategic acquisitions, divestitures and proactive financial management are testaments to its strong leadership and commitment to delivering shareholder value.
SM Energy is set to expand its oil-centered operations in the coming years with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments can create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 and 2025 earnings per share (EPS) is pegged at $6.60 and $7.46. The company has a Zacks Style Score of B for Value and Momentum. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Marathon Petroleum's acquisition of Andeavor has expanded its foothold in the Permian Basin, creating an enviable retail and marketing portfolio. MPC’s emphasis on operational excellence, safety and environmental responsibility, coupled with investments in low-carbon initiatives, positions it well for sustainable growth and continued value creation for shareholders.
The Zacks Consensus Estimate for MPC’s 2024 and 2025 EPS is pegged at $19.28 and $16.78. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2025 in the past 30 days.
Eni SpA, based in Rome, Italy, is among the leading integrated energy players in the world. The company’s share buyback program is expected to increase to €1.6 billion in 2024 from the previously declared guidance of €1.1 billion, subject to shareholder approval.
The Zacks Consensus Estimate for 2024 and 2025 EPS is pegged at $4.65 and $4.76, respectively. The company has a Zacks Style Score of A for Value and B for Momentum. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
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Here's Why It Is Worth Investing in Sunoco (SUN) Stock Now
Sunoco LP (SUN - Free Report) has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
The Zacks Consensus Estimate for Sunoco’s 2024 and 2025 earnings per share (EPS) is pegged at $5.07 and $4.47. SUN currently has a Zacks Style Score of A for Value and Growth, and B for Momentum.
What’s Favoring the Stock?
Sunoco operates an extensive network of approximately 9,500 miles of pipeline and more than 100 terminals, serving about 10,000 convenience stores, independent dealers, commercial customers and distributors across multiple regions. This vast and diversified operational footprint positions Sunoco advantageously in the market, allowing it to capitalize on various opportunities and mitigate regional risks.
Sunoco has reported a record first-quarter 2024 net income of $230 million, up from $141 million in the same quarter of 2023. This substantial increase in profitability showcases the partnership’s ability to generate higher earnings, which can be attributed to effective cost management and improved operational efficiency.
Sunoco has demonstrated a commitment to returning value to shareholders through a consistent increase in distributions. For the first quarter of 2024, the partnership increased its quarterly distribution by 4%, following a 2% increase in the previous year. This brings the distribution to 87.56 cents per unit, or $3.5 on an annualized basis.
Sunoco’s strategic acquisitions are poised to bolster its market position and drive growth. The acquisition of NuStar Energy L.P., completed on May 3, 2024, is particularly significant. This acquisition brings an additional 9,500 miles of pipeline, and 63 terminal and storage facilities, expanding Sunoco’s footprint and operational capabilities.
As of Mar 31, 2024, Sunoco had a liquidity of $870 million under its $1.5-billion revolving credit facility. The partnership also improved its financial flexibility by amending and extending its credit facility to May 2029. Sunoco’s issuer credit rating was raised to BB+ by S&P Global Ratings, and its Corporate Family Rating was upgraded to Ba1 by Moody’s, reflecting the partnership’s strengthened financial position and reduced credit risk.
On Apr 16, 2024, Sunoco successfully divested 204 convenience stores to 7-Eleven, Inc. for approximately $1 billion. This strategic move allows Sunoco to streamline its operations and focus on its core fuel distribution business, while enhancing its financial position through the influx of significant capital from the sale.
Sunoco has invested $41 million in capital expenditure in the first quarter of 2024, including $27 million in growth capital and $14 million in maintenance capital. These investments are crucial for sustaining and expanding the partnership’s infrastructure, ensuring long-term growth and operational efficiency.
Sunoco’s management has demonstrated strategic foresight by effectively navigating market challenges, optimizing the partnership’s asset portfolio, and focusing on high-return investments. The Zacks Rank #2 (Buy) partnership's strategic acquisitions, divestitures and proactive financial management are testaments to its strong leadership and commitment to delivering shareholder value.
Other Stocks to Consider
Investors interested in the energy sector may look at other top-ranked stocks like SM Energy Company (SM - Free Report) , Marathon Petroleum Corporation (MPC - Free Report) and Eni SpA (E - Free Report) . SM Energy and Marathon Petroleum sport a Zacks Rank #1 (Strong Buy), and Eni carries a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
SM Energy is set to expand its oil-centered operations in the coming years with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments can create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 and 2025 earnings per share (EPS) is pegged at $6.60 and $7.46. The company has a Zacks Style Score of B for Value and Momentum. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Marathon Petroleum's acquisition of Andeavor has expanded its foothold in the Permian Basin, creating an enviable retail and marketing portfolio. MPC’s emphasis on operational excellence, safety and environmental responsibility, coupled with investments in low-carbon initiatives, positions it well for sustainable growth and continued value creation for shareholders.
The Zacks Consensus Estimate for MPC’s 2024 and 2025 EPS is pegged at $19.28 and $16.78. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2025 in the past 30 days.
Eni SpA, based in Rome, Italy, is among the leading integrated energy players in the world. The company’s share buyback program is expected to increase to €1.6 billion in 2024 from the previously declared guidance of €1.1 billion, subject to shareholder approval.
The Zacks Consensus Estimate for 2024 and 2025 EPS is pegged at $4.65 and $4.76, respectively. The company has a Zacks Style Score of A for Value and B for Momentum. The company has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.