| Valuation method | Value, $ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 74.13 | 29 |
| Intrinsic value (DCF) | 21.60 | -62 |
| Graham-Dodd Method | n/a | |
| Graham Formula | 39.87 | -31 |
Sunoco LP (NYSE: SUN) is a leading fuel distributor and retailer in the United States, operating primarily in the Fuel Distribution and Marketing segment. With a history dating back to 1886, Sunoco LP supplies motor fuel to independently operated dealer stations, distributors, and commission agent locations, while also managing retail stores offering merchandise, foodservice, and additional convenience services. The company operates 78 retail stores in Hawaii and New Jersey, leveraging its extensive distribution network to serve diverse markets. Sunoco LP’s business model is anchored in fuel logistics and retail operations, positioning it as a key player in the Oil & Gas Refining & Marketing industry. Headquartered in Dallas, Texas, the company benefits from strategic partnerships and a strong presence in high-demand regions, reinforcing its sector relevance in the energy distribution landscape.
Sunoco LP presents a stable investment opportunity with a market capitalization of $7.52 billion and a beta of 0.64, indicating lower volatility relative to the broader market. The company reported $22.7 billion in revenue and $874 million in net income for the latest fiscal year, with a diluted EPS of $7.32. Its operating cash flow of $549 million supports a robust dividend yield, with a dividend per share of $3.5353. However, high total debt of $7.99 billion and capital expenditures of -$344 million suggest financial leverage and reinvestment needs. Investors may find Sunoco LP attractive for its steady cash flows and dividend payouts, though exposure to fuel price volatility and debt levels warrants caution.
Sunoco LP’s competitive advantage lies in its extensive distribution network and diversified retail operations. The company’s Fuel Distribution and Marketing segment benefits from long-term contracts with independent dealers and distributors, ensuring stable revenue streams. Its retail stores in Hawaii and New Jersey provide additional income through merchandise and services, reducing reliance solely on fuel margins. Sunoco LP’s scale allows for cost efficiencies in procurement and logistics, though it faces competition from larger integrated oil companies and regional fuel distributors. The company’s partnership model with independent operators enhances its market reach without significant capital outlays for owned stations. However, its limited geographic concentration in certain markets (e.g., Hawaii) may expose it to regional economic risks. Compared to peers, Sunoco LP’s midstream-focused approach differentiates it from purely retail-focused competitors, but it must navigate regulatory and environmental pressures impacting the fuel distribution industry.