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Sunoco (SUN) Q2 Earnings and Revenues Outpace Estimates
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Sunoco LP (SUN - Free Report) reported second-quarter 2024 earnings per share (EPS) of $3.85, which beat the Zacks Consensus Estimate of $1.79. The bottom line also increased from the year-ago quarter’s level of $0.78.
Total quarterly revenues of $6.17 billion beat the Zacks Consensus Estimate of $5.49 billion. The top line increased from $5.75 billion reported a year ago.
The strong quarterly results were largely driven by higher contributions across all segments and a boost in fuel sales, which were further enhanced by the positive impact of the NuStar acquisition.
Sunoco reports financial results from the second quarter under three reportable segments — Fuel Distribution, Pipeline Systems and Terminals.
Fuel Distribution: Adjusted EBITDA in the segment increased to $245 million from $226 million in the comparable period of 2023, primarily due to higher motor fuel sales.
Pipeline Systems: The unit reported adjusted EBITDA of $53 million compared with $3 million in the prior-year quarter. The increase was primarily due to the acquisition of NuStar.
Terminals: The segment reported adjusted EBITDA of $22 million, up from $21 million reported in the corresponding period of 2023. The rise was primarily due to the recent acquisitions of NuStar, Zenith European and Zenith Energy terminals located across the East Coast and Midwest.
In terms of volume, the partnership sold 2.2 billion gallons of fuel in the reported quarter, up 5% from the prior-year quarter’s level. The figure also beat our estimate of 2.1 billion gallons.
Motor fuel gross profit per gallon was 11.8 cents compared with the year-ago level of 11.9 cents.
Sunoco reported a total operating income of $150 million, which increased from $141 million reported in the prior-year quarter.
For the quarter ended Jun 30, 2024, the net income was $501 million compared with $87 million in the second quarter of 2023.
Distributable Cash Flow
The adjusted distributable cash flow totaled $295 million, up from the year-ago level of $175 million.
Expenses & Capital Expenditure
The total cost of sales and operating expenses increased to $6.02 billion from $5.60 billion a year ago.
The partnership incurred a capital expenditure of $78 million, comprising $52 million in growth capital and $26 million in maintenance capital.
Balance Sheet
As of Jun 30, 2024, Sunoco had cash and cash equivalents of $226 million and a net long-term debt of $7.3 billion.
Guidance
For 2024, the partnership reaffirms its adjusted EBITDA projection in the range of $1.46-$1.52 billion, implying an increase from $964 million reported in 2023. Additionally, the partnership expects approximately $50 million in synergies related to the acquisition of NuStar.
Zacks Rank & Other Stocks to Consider
Sunoco currently flaunts a Zacks Rank #1 (Strong Buy).
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 should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.09. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Hess operates primarily in two areas — the Bakken shale and the Stabroek project offshore Guyana. It is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. HES currently has a Growth Score of A.
The Zacks Consensus Estimate for 2024 and 2025 EPS is pegged at $10.97 and $12.55, respectively. The company has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Baker Hughes, a leading player in the oilfield service sector, is known for its advanced technologies and equipment catering to the needs of upstream companies. It expects substantial growth from LNG contracts globally due to the strong demand outlook.
The Zacks Consensus Estimate for BKR’s 2024 EPS is pegged at $2.20. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
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Sunoco (SUN) Q2 Earnings and Revenues Outpace Estimates
Sunoco LP (SUN - Free Report) reported second-quarter 2024 earnings per share (EPS) of $3.85, which beat the Zacks Consensus Estimate of $1.79. The bottom line also increased from the year-ago quarter’s level of $0.78.
Total quarterly revenues of $6.17 billion beat the Zacks Consensus Estimate of $5.49 billion. The top line increased from $5.75 billion reported a year ago.
The strong quarterly results were largely driven by higher contributions across all segments and a boost in fuel sales, which were further enhanced by the positive impact of the NuStar acquisition.
Sunoco LP Price, Consensus and EPS Surprise
Sunoco LP price-consensus-eps-surprise-chart | Sunoco LP Quote
Segmental Performance
Sunoco reports financial results from the second quarter under three reportable segments — Fuel Distribution, Pipeline Systems and Terminals.
Fuel Distribution: Adjusted EBITDA in the segment increased to $245 million from $226 million in the comparable period of 2023, primarily due to higher motor fuel sales.
Pipeline Systems: The unit reported adjusted EBITDA of $53 million compared with $3 million in the prior-year quarter. The increase was primarily due to the acquisition of NuStar.
Terminals: The segment reported adjusted EBITDA of $22 million, up from $21 million reported in the corresponding period of 2023. The rise was primarily due to the recent acquisitions of NuStar, Zenith European and Zenith Energy terminals located across the East Coast and Midwest.
In terms of volume, the partnership sold 2.2 billion gallons of fuel in the reported quarter, up 5% from the prior-year quarter’s level. The figure also beat our estimate of 2.1 billion gallons.
Motor fuel gross profit per gallon was 11.8 cents compared with the year-ago level of 11.9 cents.
Sunoco reported a total operating income of $150 million, which increased from $141 million reported in the prior-year quarter.
For the quarter ended Jun 30, 2024, the net income was $501 million compared with $87 million in the second quarter of 2023.
Distributable Cash Flow
The adjusted distributable cash flow totaled $295 million, up from the year-ago level of $175 million.
Expenses & Capital Expenditure
The total cost of sales and operating expenses increased to $6.02 billion from $5.60 billion a year ago.
The partnership incurred a capital expenditure of $78 million, comprising $52 million in growth capital and $26 million in maintenance capital.
Balance Sheet
As of Jun 30, 2024, Sunoco had cash and cash equivalents of $226 million and a net long-term debt of $7.3 billion.
Guidance
For 2024, the partnership reaffirms its adjusted EBITDA projection in the range of $1.46-$1.52 billion, implying an increase from $964 million reported in 2023. Additionally, the partnership expects approximately $50 million in synergies related to the acquisition of NuStar.
Zacks Rank & Other Stocks to Consider
Sunoco currently flaunts a Zacks Rank #1 (Strong Buy).
Investors interested in the energy sector may look at some other top-ranked stocks like SM Energy Company (SM - Free Report) , Hess Corporation (HES - Free Report) and Baker Hughes Company (BKR - Free Report) . While SM Energy currently sports a Zacks Rank #1, Hess and Baker Hughes carry a Zacks Rank #2 (Buy) each. 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 should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.09. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Hess operates primarily in two areas — the Bakken shale and the Stabroek project offshore Guyana. It is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. HES currently has a Growth Score of A.
The Zacks Consensus Estimate for 2024 and 2025 EPS is pegged at $10.97 and $12.55, respectively. The company has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Baker Hughes, a leading player in the oilfield service sector, is known for its advanced technologies and equipment catering to the needs of upstream companies. It expects substantial growth from LNG contracts globally due to the strong demand outlook.
The Zacks Consensus Estimate for BKR’s 2024 EPS is pegged at $2.20. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.