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Why Is Sunoco LP (SUN) Down 10.9% Since Last Earnings Report?
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It has been about a month since the last earnings report for Sunoco LP (SUN - Free Report) . Shares have lost about 10.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sunoco LP due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Sunoco's Q4 Earnings Miss Estimates
Sunoco reported fourth-quarter 2022 earnings of 42 cents per unit, missing the Zacks Consensus Estimate of 77 cents. The bottom line significantly decreased from the year-ago quarter’s 95 cents per unit.
Total quarterly revenues of $5,918 million beat the Zacks Consensus Estimate of $5,862 million. The top line increased from $4,954 million a year ago.
The weak quarterly earnings were due to the higher total cost of sales and operating expenses.
Segmental Performance
Sunoco reports financial results through two reportable segments — Fuel Distribution and Marketing, and All Other.
Fuel Distribution and Marketing: Adjusted EBITDA from the segment increased to $183 million from $141 million in the comparable period of 2021, primarily due to higher motor fuel sales.
All Other: The unit reported an adjusted EBITDA of $55 million compared with $57 million in the prior-year quarter. The year-over-year decrease can be attributed to lower lease income.
In terms of volumes, the partnership sold 1,979 million gallons of fuel in the reported quarter, up year over year. Motor fuel gross profit per gallon was 12.8 cents compared with the year-ago level of 12 cents.
Distributable Cash Flow
Adjusted distributable cash flow was $153 million in the fourth quarter, reflecting an increase from the year-ago quarter’s $143 million.
Expenses & Capital Expenditure
The total cost of sales and operating expenses in the reported quarter increased to $5,822 million from $4,778 million a year ago.
The partnership incurred a capital expenditure of $89 million in the reported quarter, comprising $56 million in growth capital and $33 million in maintenance capital.
Balance Sheet
As of Dec 31, 2022, Sunoco had cash and cash equivalents of $82 million. At fourth-quarter end, it had net long-term debt of $2,671 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
VGM Scores
At this time, Sunoco LP has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Sunoco LP has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.
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Why Is Sunoco LP (SUN) Down 10.9% Since Last Earnings Report?
It has been about a month since the last earnings report for Sunoco LP (SUN - Free Report) . Shares have lost about 10.9% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Sunoco LP due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Sunoco's Q4 Earnings Miss Estimates
Sunoco reported fourth-quarter 2022 earnings of 42 cents per unit, missing the Zacks Consensus Estimate of 77 cents. The bottom line significantly decreased from the year-ago quarter’s 95 cents per unit.
Total quarterly revenues of $5,918 million beat the Zacks Consensus Estimate of $5,862 million. The top line increased from $4,954 million a year ago.
The weak quarterly earnings were due to the higher total cost of sales and operating expenses.
Segmental Performance
Sunoco reports financial results through two reportable segments — Fuel Distribution and Marketing, and All Other.
Fuel Distribution and Marketing: Adjusted EBITDA from the segment increased to $183 million from $141 million in the comparable period of 2021, primarily due to higher motor fuel sales.
All Other: The unit reported an adjusted EBITDA of $55 million compared with $57 million in the prior-year quarter. The year-over-year decrease can be attributed to lower lease income.
In terms of volumes, the partnership sold 1,979 million gallons of fuel in the reported quarter, up year over year. Motor fuel gross profit per gallon was 12.8 cents compared with the year-ago level of 12 cents.
Distributable Cash Flow
Adjusted distributable cash flow was $153 million in the fourth quarter, reflecting an increase from the year-ago quarter’s $143 million.
Expenses & Capital Expenditure
The total cost of sales and operating expenses in the reported quarter increased to $5,822 million from $4,778 million a year ago.
The partnership incurred a capital expenditure of $89 million in the reported quarter, comprising $56 million in growth capital and $33 million in maintenance capital.
Balance Sheet
As of Dec 31, 2022, Sunoco had cash and cash equivalents of $82 million. At fourth-quarter end, it had net long-term debt of $2,671 million.
How Have Estimates Been Moving Since Then?
It turns out, fresh estimates have trended upward during the past month.
VGM Scores
At this time, Sunoco LP has a subpar Growth Score of D, a grade with the same score on the momentum front. However, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of D. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. It comes with little surprise Sunoco LP has a Zacks Rank #1 (Strong Buy). We expect an above average return from the stock in the next few months.