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1. Company Snapshot

1.a. 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.

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1.b. Last Insights on SUN

Sunoco LP's recent performance has been driven by solid fourth-quarter and full-year 2025 financial and operating results. The company's adjusted EBITDA attributable to SUN for Q4 2025 was $646 million. Additionally, Sunoco LP has received a consensus "Buy" rating from seven analysts, with five assigning a buy rating and one a strong buy rating (MarketBeat Ratings). The company's recent earnings release showed net income attributable to SUN for Q4 2025 was $97 million. Compass Wealth Management LLC also acquired a new stake in Sunoco LP shares.

1.c. Company Highlights

2. Sunoco LP's Record Performance in 2025

Sunoco LP reported a strong financial performance in 2025, with record adjusted EBITDA of $706 million in the fourth quarter, excluding $60 million of one-time transaction expenses. The company's fuel distribution segment delivered adjusted EBITDA of $391 million, excluding $59 million of transaction expenses. The actual EPS came out at $0.00196, significantly lower than the estimated $1.64. Revenue growth is expected to be 1.3% next year. The company's P/E Ratio is 7790.69, indicating a potentially overvalued stock.

Publication Date: Feb -18

📋 Highlights
  • Record Q4 Adjusted EBITDA:: Achieved $706 million in Q4 2025, excluding $60 million in one-time transaction expenses from the Parkland acquisition.
  • Geographic Expansion:: Operates across 32 countries/territories, becoming the largest independent fuel distributor in the Americas post-Parkland integration.
  • Fuel Distribution Growth:: Delivered $391 million in adjusted EBITDA for the segment (excluding $59 million in transaction costs), with 44% increase in gallons distributed (3.3 billion gallons).
  • 2026 Growth Guidance:: Targets minimum 5% annual EBITDA growth, with Karl Fails stating synergies from Parkland could exceed $125 million by year-end 2026.
  • Financial Resilience:: Returned to 4x leverage ratio within two months of the Parkland acquisition, enabling $500 million+ in bolt-on acquisition capacity for 2026.

Operational Highlights

The company's operations expanded significantly in 2025, with the acquisition of Parkland and Tankwood assets. Sunoco now operates a diversified footprint spanning 32 countries and territories, making it the largest independent fuel distributor in the Americas. The fuel distribution segment distributed 3.3 billion gallons, up 44% versus the previous quarter and 54% versus the fourth quarter of last year. As Joseph Kim mentioned, "We came into 2025 financially healthy, and we finished the year bigger and stronger than where we started."

Growth Prospects

Sunoco expects a minimum of 5% annual growth in 2026 and continued growth over a multiyear period. The company's diversified footprint and vertical integration opportunities are expected to drive EBITDA growth. The Canadian business is expected to be an outstanding addition to the portfolio, and the Caribbean business is seeing strong volume growth. With a P/S Ratio of 0.33, the stock appears to be reasonably valued relative to its sales.

Valuation and Returns

The company's EV/EBITDA ratio is 5.97, indicating a reasonable valuation relative to its earnings. Sunoco's ROE is 9.8%, and ROIC is 3.4%, indicating a decent return on equity and invested capital. The Dividend Yield is 6.05%, which is attractive for income investors. The Net Debt / EBITDA ratio is 0.4, indicating a healthy debt profile.

Synergies and Integration

Karl R. Fails mentioned that the company is excited about the Parkland acquisition and expects to deliver on synergies, targeting $125 million in 2026. The company has already started ramping up activities to achieve this target and expects to exit the year "well north" of the target on a run-rate basis. With a Free Cash Flow Yield of 4.52%, Sunoco has a decent cash flow generation capability.

3. NewsRoom

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Compass Wealth Management LLC Invests $644,000 in Sunoco LP $SUN

Feb -21

Source: defenseworld.net

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Sunoco: Set For Distribution Growth Despite IDR Headwinds

Feb -19

Source: seekingalpha.com

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Sunoco LP and SunocoCorp LLC File 2025 Annual Reports on Form 10-K

Feb -19

Source: businesswire.com

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Sunoco After Earnings: New All-Time Highs Within Reach (Upgrade)

Feb -19

Source: seekingalpha.com

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Stardust Solar Advances U.S. Operations with Entry into Atlanta

Feb -19

Source: newsfilecorp.com

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Stardust Solar Closes $1,000,000 Non-Brokered Private Placement of Secured Senior Convertible Debenture Units

Feb -18

Source: newsfilecorp.com

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Sunoco LP Common Units (SUN) Q4 2025 Earnings Call Transcript

Feb -17

Source: seekingalpha.com

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Compared to Estimates, Sunoco LP (SUN) Q4 Earnings: A Look at Key Metrics

Feb -17

Source: zacks.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (14.80%)

6. Segments

Fuel Distribution and Marketing

Expected Growth: 15%

Sunoco LP's 15% growth in Fuel Distribution and Marketing is driven by increasing demand for gasoline and diesel, strategic acquisitions, and expansion of its convenience store network. Additionally, the company's focus on operational efficiency, cost savings, and investments in digital platforms have contributed to its growth momentum.

All Other

Expected Growth: 12%

All Other segment of Sunoco LP, with 12% growth, is driven by increasing demand for non-fuel services, expansion of convenience stores, and strategic acquisitions. Additionally, growth in merchandise sales, commission income, and fees from credit card transactions also contribute to the segment's growth.

Intercompany Eliminations

Expected Growth: 10%

Sunoco LP's 10% growth in Intercompany Eliminations is driven by increased fuel sales volume, higher wholesale fuel prices, and strategic acquisitions. Additionally, the company's focus on cost savings initiatives and optimization of its logistics and transportation network have contributed to the growth. Furthermore, Sunoco LP's ability to effectively manage its working capital and maintain a strong balance sheet has also supported its growth momentum.

7. Detailed Products

Fuel

Sunoco LP is a leading fuel distributor, providing a range of fuel products including gasoline, diesel, and alternative fuels to convenience stores, independent dealers, and commercial customers.

Lubricants

Sunoco LP offers a variety of lubricants, including motor oils, transmission fluids, and gear oils, designed to meet the needs of automotive, commercial, and industrial customers.

Convenience Store Services

Sunoco LP provides a range of services to convenience store owners, including fuel supply, equipment maintenance, and marketing support.

Commercial Fleet Fueling

Sunoco LP offers a commercial fleet fueling program, providing fuel management solutions to fleets of all sizes.

APlus Convenience Stores

Sunoco LP operates a chain of APlus convenience stores, offering a range of food, beverages, and merchandise to customers.

8. Sunoco LP's Porter Forces

Forces Ranking

Threat Of Substitutes

Sunoco LP's threat of substitutes is moderate due to the availability of alternative energy sources and transportation methods.

Bargaining Power Of Customers

Sunoco LP's customers have limited bargaining power due to the company's strong brand recognition and wide distribution network.

Bargaining Power Of Suppliers

Sunoco LP's suppliers have moderate bargaining power due to the company's dependence on a few large suppliers for crude oil and other raw materials.

Threat Of New Entrants

The threat of new entrants in the energy industry is low due to the high barriers to entry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The intensity of rivalry in the energy industry is high due to the presence of several large and established players, leading to intense competition for market share.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 78.20%
Debt Cost 5.84%
Equity Weight 21.80%
Equity Cost 10.37%
WACC 6.83%
Leverage 358.69%

11. Quality Control: Sunoco LP passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

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Alliance Resource Partners

A-Score: 6.6/10

Value: 7.4

Growth: 4.7

Quality: 5.9

Yield: 10.0

Momentum: 2.5

Volatility: 9.0

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Chord Energy

A-Score: 6.5/10

Value: 7.7

Growth: 8.1

Quality: 5.0

Yield: 10.0

Momentum: 2.0

Volatility: 6.0

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HF Sinclair

A-Score: 6.5/10

Value: 7.4

Growth: 4.0

Quality: 5.0

Yield: 7.0

Momentum: 9.0

Volatility: 6.3

1-Year Total Return ->

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Sunoco

A-Score: 6.4/10

Value: 6.6

Growth: 4.0

Quality: 3.2

Yield: 10.0

Momentum: 5.5

Volatility: 9.0

1-Year Total Return ->

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PBF Energy

A-Score: 5.0/10

Value: 8.0

Growth: 1.8

Quality: 3.0

Yield: 6.0

Momentum: 8.5

Volatility: 2.7

1-Year Total Return ->

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Valvoline

A-Score: 4.1/10

Value: 3.4

Growth: 5.3

Quality: 5.8

Yield: 0.0

Momentum: 3.0

Volatility: 7.3

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

62.54$

Current Price

62.54$

Potential

-0.00%

Expected Cash-Flows