Sunoco (SUN) AI Stock Analysis

• Market Cap: $8.03B
• Dividend Yield: 6.61%
• Average Volume (3M): 380.61K
• Price to Earnings (P/E): 9.5
• Beta (1Y): 0.72
• Revenue Growth: -3.59%
• EPS Growth: 22.77%
• Country: US
• Employees: 3,298
• Sector: Energy
• Sector Strength: 45
• Industry: Oil & Gas Refining & Marketing
• EPS (TTM): 1.32
• Shares Outstanding: 136,332,200
• 10 Day Avg. Volume: 393,070
• 30 Day Avg. Volume: 380,611
• PEG Ratio: -0.65
• Price to Book (P/B): 0.00
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 516.30
• Enterprise Value/Market Cap: 1.90
• Enterprise Value/Revenue: 0.17
• Enterprise Value/Gross Profit: 8.56
• Enterprise Value/Ebitda: 2.36
• 1Y Price Target: $65.25
• Price Target Upside: 22.01% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 4

• Rating: 72 Outperform
• Price Target: $59.00 ▲(10.32%Upside)

Sunoco's overall stock score is primarily driven by its solid financial performance and positive earnings call outlook. While technical analysis shows mixed momentum, the company's strong valuation metrics and strategic initiatives in the earnings call provide a positive outlook. Continued focus on debt management and cash flow improvement will be key for long-term success.

Positive Factors

Adjusted EBITDA growth

SUN remains undervalued given strong prospects for adjusted EBITDA growth in fuel distribution and a higher-quality base business via its NS acquisition that has still not been credited.

Distribution growth

The company signaled that distribution growth could be 'at least 5%' for the fiscal year and potentially beyond.

Merger and acquisition opportunities

SUN management is optimistic about merger and acquisition opportunities and its interest in expanding in Europe and the Caribbean.

Negative Factors

AI/data center narrative

SUN's underperformance is attributed to its lack of exposure to the AI/data center narrative, which has buoyed valuations across much of analyst coverage.

MLP structure concerns

Investor concerns include SUN's MLP structure and whether ET wields greater influence over SUN than previously appreciated.

Seasonal underperformance

Seasonal underperformance in 'Fuel Distribution' appears explainable as SUN typically experiences a step-down in the fourth quarter following the summer driving season.

Sunoco Business Overview & Revenue Model

Company Description

Sunoco LP, together with its subsidiaries, distributes and retails motor fuels in the United States. It operates in two segments, Fuel Distribution and Marketing, and All Other. The Fuel Distribution and Marketing segment purchases motor fuel from independent refiners and oil companies and supplies it to independently operated dealer stations, distributors and other consumer of motor fuel, and partnership operated stations, as well as to commission agent locations. The All Other segment operates retail stores that offer motor fuel, merchandise, foodservice, and other services that include credit card processing, car washes, lottery, automated teller machines, money orders, prepaid phone cards, and wireless services. It also leases and subleases real estate properties; and operates terminal facilities on the Hawaiian Islands. As of December 31, 2021, the company operated 78 retail stores in Hawaii and New Jersey. Sunoco GP LLC serves as the general partner of the company. The company was formerly known as Susser Petroleum Partners LP and changed its name to Sunoco LP in October 2014. Sunoco LP was founded in 1886 and is headquartered in Dallas, Texas.

How the Company Makes Money

Sunoco makes money primarily through the wholesale distribution of motor fuels, which accounts for the majority of its revenue. The company buys refined fuels from various suppliers, including major oil companies, and sells them to a diverse customer base that includes independent dealers, convenience stores, and commercial operators. Sunoco's earnings are significantly influenced by fuel volume sales and the margin between the purchase and sale price of fuel. In addition to wholesale fuel distribution, the company generates income from the operation of company-operated convenience stores and from fees associated with its franchise and licensing agreements. Strategic partnerships with suppliers and retailers also contribute to its revenue by enhancing its distribution network and ensuring a steady supply of products.

Sunoco Financial Statement Overview

Summary

Sunoco maintains a robust financial position with strong profitability metrics and a stable balance sheet. While the company faces challenges in revenue growth and cash flow generation, its profitability and equity position provide a solid foundation for future growth.

Income Statement

Sunoco's income statement shows a solid performance with a strong gross profit margin of 7.97% and a net profit margin of 3.25% for TTM. The company has demonstrated resilience with a positive EBIT margin of 3.74% and EBITDA margin of 7.62%. However, revenue has slightly declined by 1.41% compared to the previous year, indicating a need for growth focus.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 1.97, indicating moderate leverage. The equity ratio stands at 28.98%, showing a healthy proportion of equity financing. Return on equity is robust at 17.47%, but the high debt level poses potential risks if not managed carefully.

Cash Flow

Cash flow analysis reveals a mixed picture with a free cash flow growth rate of -93.17%, indicating a significant decline. However, the operating cash flow to net income ratio of 0.58 and free cash flow to net income ratio of 0.02 suggest that the company is generating cash, albeit at a reduced rate.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	22.69B	23.07B	25.73B	17.60B	10.71B
Gross Profit	2.10B	1.18B	1.19B	1.17B	867.00M
EBITDA	1.03B	825.00M	877.00M	894.00M	602.00M
Net Income	874.00M	311.00M	397.00M	446.00M	212.00M
Balance Sheet
Total Assets	14.38B	6.83B	6.83B	5.82B	5.27B
Cash, Cash Equivalents and Short-Term Investments	94.00M	29.00M	82.00M	25.00M	97.00M
Total Debt	8.00B	4.11B	4.12B	3.79B	3.67B
Total Liabilities	10.31B	5.85B	5.89B	5.00B	4.63B
Stockholders Equity	4.07B	978.00M	942.00M	811.00M	632.00M
Cash Flow
Free Cash Flow	205.00M	385.00M	375.00M	369.00M	378.00M
Operating Cash Flow	549.00M	600.00M	561.00M	543.00M	502.00M
Investing Cash Flow	477.00M	-288.00M	-464.00M	-387.00M	-120.00M
Financing Cash Flow	-961.00M	-365.00M	-40.00M	-228.00M	-306.00M

Sunoco Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 53.48
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SUN, the sentiment is Neutral. The current price of 53.48 is above the 20-day moving average (MA) of 53.21, below the 50-day MA of 53.93, and below the 200-day MA of 53.63, indicating a neutral trend. The MACD of -0.27 indicates Negative momentum. The RSI at 51.37 is Neutral, neither overbought nor oversold. The STOCH value of 65.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SUN.

Sunoco Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SUN	72 Outperform	$8.03B	9.45	26.11%	6.61%	-3.59%	22.77%
DINO	66 Neutral	$8.62B	35.13	-1.49%	5.47%	-11.17%	-109.60%
UGP	65 Neutral	$3.19B	8.07	14.87%	1.52%	-4.58%	-23.80%
Sector *	60 Neutral	£7.41B	-2.82	-10.36%	104.91%	-1.03%	-98.53%
PBF	54 Neutral	$2.81B	―	-18.01%	4.42%	-16.30%	-160.78%
DK	51 Neutral	$1.37B	―	-151.69%	4.52%	-29.23%	-931.43%
CVI	49 Neutral	$2.83B	268.82	-27.14%	10.11%	-16.21%	-130.18%

Sunoco Corporate Events

Sunoco Amends Acquisition Agreement with Parkland

On May 26, 2025, Sunoco LP amended its arrangement agreement with Parkland Corporation to adjust the funding mechanics and proration formula for their acquisition plan, while maintaining other key terms. This amendment is part of Sunoco’s strategic acquisition of Parkland, valued at approximately $9.1 billion, expected to close in the second half of 2025, pending shareholder and regulatory approvals. The acquisition is part of Sunoco’s broader strategy, which included the completed acquisition of NuStar Energy in May 2024 and the sale of convenience stores to 7-Eleven in April 2024, reflecting a significant shift in its operational focus and market positioning.

The most recent analyst rating on (SUN) stock is a Buy with a $59.00 price target. To see the full list of analyst forecasts on Sunoco stock, see the SUN Stock Forecast page.

Sunoco’s Acquisition of Parkland and Indenture Amendments

On May 4, 2025, Sunoco entered into an Arrangement Agreement to acquire all outstanding common shares of Parkland Corporation. In connection with this transaction, Parkland announced a private consent solicitation on May 27, 2025, to amend the indentures governing its outstanding senior notes. This amendment aims to eliminate the obligation for a Change of Control Offer and redefine ‘Change of Control’ to recognize Sunoco and its affiliates as ‘Qualified Owners.’ Sunoco has agreed to reimburse Parkland for any consent fees and related costs incurred during this process.

The most recent analyst rating on (SUN) stock is a Buy with a $59.00 price target. To see the full list of analyst forecasts on Sunoco stock, see the SUN Stock Forecast page.

Sunoco Amends Credit Agreement with Bank of America

On May 16, 2025, Sunoco LP amended its Third Amended and Restated Credit Agreement with Bank of America and other lenders. The amendment increased the letter of credit sublimit to $250 million, excluded Parkland and its subsidiaries from certain guarantee requirements, and allowed the partnership to incur specific types of bridge debt. Additionally, $1.50 billion of previously disclosed debt financing commitments were terminated.

The most recent analyst rating on (SUN) stock is a Buy with a $59.00 price target. To see the full list of analyst forecasts on Sunoco stock, see the SUN Stock Forecast page.

Sunoco Announces Q1 2025 Results and Acquisitions

On May 6, 2025, Sunoco LP announced its first quarter 2025 financial results, reporting a net income of $207 million and an adjusted EBITDA of $458 million. The company declared a 1.25% increase in its quarterly distribution, aligning with its strategy to achieve a 5% annual distribution growth. Sunoco also revealed plans to acquire Parkland Corporation for $9.1 billion and TanQuid, a terminal operator in Germany and Poland, for approximately €500 million. These acquisitions are expected to enhance Sunoco’s market position and diversify its cash flows, with both transactions anticipated to close in the second half of 2025.

Sunoco Board Member Christopher Curia Announces Retirement

On April 22, 2025, Christopher R. Curia announced his retirement from the board of directors of Sunoco GP LLC, effective May 1, 2025. His departure is not due to any disagreements with the company, and he has been a director since August 2014.