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Relative valuation derived from Energy sector median benchmarks. Model weights: EV/EBITDA (40%), P/B (35%), P/S (25%). Multiples adjusted for extreme outliers and non-recurring volatility.
Auditing capital efficiency...
Quality Profile Audit
Score: 50GRADE C+
Composite assessment of profitability, capital efficiency, and financial strength. Top-tier entities demonstrate sustainable cash flow generation.
Return on Equity
Profit generated per dollar of shareholder equity
5.4%
Sector: 6.7%
Dividend Analysis audit
HIGH YIELD
7.26%
Trailing Yield
$7.26
Per $100 Invested
High yield — monitor payout sustainability closely.
Est. Payout Ratio
210%HIGH
Analyst Projections
Analyst Consensus
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Based on our 6-factor quantitative model, Sunoco LP (SUN) receives a "Hold" rating with a composite score of 49.7/100, ranked #278 out of 4446 stocks. Key factor scores: Quality 50/100, Value 56/100, Momentum 55/100. This is quantitative analysis only — not investment advice.
Sunoco LP (SUN) Stock Analysis — April 2026 Rating, Price, and Forecast
Company Overview — What Does Sunoco LP Do?
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. Sunoco LP (SUN) is classified as a large-cap stock in the Energy sector, specifically within the Petroleum And Natural Gas industry. The company is led by CEO Joseph Kim and employs approximately 2,300 people, headquartered in Dallas, Texas. With a market capitalization of $12.1B, SUN is one of the prominent companies in the Energy sector.
Sunoco LP (SUN) Stock Rating — Hold (April 2026)
As of April 2026, Sunoco LP receives a Hold rating with a composite score of 49.7/100 and 3 out of 5 stars from the Blank Capital Research quantitative model.SUN ranks #278 out of 4,446 stocks in our coverage universe. Within the Energy sector, Sunoco LP ranks #41 of 128 stocks, placing it in the upper half of its Energy peers. The rating is generated by a multi-factor model that weighs quality (30%), momentum (25%), value (15%), investment (10%), stability (10%), and short interest (10%).
SUN Stock Price and 52-Week Range
Sunoco LP (SUN) currently trades at $65.06. The stock lost $0.69 (1.0%) in the most recent trading session. The 52-week high for SUN is $66.83, which means the stock is currently trading -2.6% from its annual peak. The 52-week low is $47.98, putting the stock 35.6% above its annual trough. Recent trading volume was 209K shares, suggesting relatively thin trading activity.
Is SUN Overvalued or Undervalued? — Valuation Analysis
Sunoco LP (SUN) carries a value factor score of 56/100 in the Blank Capital model, indicating fair valuation relative to historical norms. The trailing price-to-earnings ratio is 28.92x, compared to the Energy sector average of 19.63x — a premium of 47%. The price-to-book ratio stands at 1.56x, versus the sector average of 1.64x. The price-to-sales ratio is 0.56x, compared to 0.47x for the average Energy stock. On an enterprise value basis, SUN trades at 30.15x EV/EBITDA, versus 3.50x for the sector.
Overall, SUN's valuation appears roughly in line with sector benchmarks, suggesting the market is pricing the stock fairly given its current fundamentals and growth trajectory. Neither deep value nor significantly overpriced, the stock occupies a middle ground on valuation.
Sunoco LP Profitability — ROE, Margins, and Quality Score
Sunoco LP (SUN) earns a quality factor score of 50/100, indicating solid business quality with consistent operational execution. The return on equity (ROE) is 5.4%, compared to the Energy sector average of 6.7%, which is below typical expectations for high-quality companies. Return on assets (ROA) comes in at 1.5% versus the sector average of 3.7%.
On a margin basis, Sunoco LP reports gross margins of 10.3%, compared to 52.7% for the sector. The operating margin is 3.9% (sector: 10.7%). Net profit margin stands at 2.0%, versus 6.4% for the average Energy stock. Revenue growth is running at -2.3% on a trailing basis, compared to -1.2% for the sector. The overall profitability profile is adequate, though there may be room for margin expansion.
SUN Debt, Balance Sheet, and Financial Health
Sunoco LP has a debt-to-equity ratio of 167.0%, compared to the Energy sector average of 55.0%. This elevated leverage warrants close monitoring, as it increases the company's sensitivity to rising interest rates and economic downturns. The current ratio is 1.38x, suggesting adequate working capital coverage. Total debt on the balance sheet is $13.37B. Cash and equivalents stand at $3.24B.
SUN has a beta of 0.44, meaning it is less volatile than the S&P 500, making it a relatively defensive holding. The stability factor score for Sunoco LP is 87/100, indicating low-volatility characteristics and consistent price behavior that appeals to risk-averse investors.
Sunoco LP Revenue and Earnings History — Quarterly Trend
In TTM 2026, Sunoco LP reported revenue of $22.35B. Net income for the quarter was $432M. Gross margin was 10.3%. Operating income came in at $858M.
In FY 2025, Sunoco LP reported revenue of $25.20B. Net income for the quarter was $527M. Gross margin was 11.1%. Revenue grew 11.1% year-over-year compared to FY 2024. Operating income came in at $935M.
In Q3 2025, Sunoco LP reported revenue of $6.03B. Net income for the quarter was $137M. Gross margin was 10.7%. Revenue grew 4.9% year-over-year compared to Q3 2024. Operating income came in at $252M.
In Q2 2025, Sunoco LP reported revenue of $5.39B. Net income for the quarter was $86M. Gross margin was 10.6%. Revenue grew -12.7% year-over-year compared to Q2 2024. Operating income came in at $203M.
Over the past 8 quarters, Sunoco LP has demonstrated a growth trajectory, with revenue expanding from $6.17B to $22.35B. Investors analyzing SUN stock should weigh these quarterly trends alongside the valuation and quality metrics discussed above.
SUN Dividend Yield and Income Analysis
Sunoco LP (SUN) currently pays a dividend yield of 7.3%. At this yield, a $10,000 investment in SUN stock would generate approximately $$726.00 in annual dividend income. This compares to the Energy sector average dividend yield of 1.9%, meaning SUN offers above-average income for its sector.
SUN Momentum and Technical Analysis Profile
Sunoco LP (SUN) has a momentum factor score of 55/100, reflecting neutral trend characteristics. The stock is neither significantly outperforming nor underperforming the broader market on a momentum basis. The investment factor score is 34/100, which measures capital allocation efficiency and asset growth patterns. The short interest score of 5/100 signals elevated short interest, which can indicate bearish sentiment among institutional investors.
SUN vs Competitors — Energy Sector Ranking and Peer Comparison
Comparing SUN against the S&P 500 benchmark is also instructive for understanding relative performance. Investors can view the full SUN vs S&P 500 (SPY) comparison to assess how Sunoco LP stacks up against the broader market across all factor dimensions.
SUN Next Earnings Date
No upcoming earnings date has been announced for Sunoco LP (SUN) at this time. Check the earnings calendar for the latest scheduling updates across all stocks in our coverage universe.
Should You Buy SUN? — Investment Thesis Summary
Sunoco LP presents a balanced picture with arguments on both sides. Low volatility (stability score 87/100) reduces downside risk.
In summary, Sunoco LP (SUN) earns a Hold rating with a composite score of 49.7/100 as of April 2026. The rating is derived from the Blank Capital Research methodology, which combines six factor dimensions into a single quantitative ranking. Investors should consider these quantitative signals alongside their own fundamental research, risk tolerance, and investment time horizon before making buy or sell decisions on SUN stock.
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Institutional Research Dossier
Sunoco LP (SUN) Deep Dive Analysis
Published on March 24, 2026
Action RatingHold
Sections
Executive Summary
Sunoco LP (SUN) receives a Hold rating, justified by a composite score of 49.6/100, placing it in the middle of its peer group. While the company exhibits stability and a reasonable valuation, concerns regarding its high debt levels, negative free cash flow, and relatively low profitability compared to the energy sector temper enthusiasm for a more bullish outlook. The critical takeaway is that Sunoco's operational stability and market position are offset by financial constraints that limit its growth potential and necessitate careful monitoring.
The company's business model, focused on fuel distribution and marketing, provides a consistent revenue stream, but its reliance on commodity-driven products exposes it to market volatility. The Hold rating reflects a balanced view, acknowledging Sunoco's established presence and stable operations while remaining cautious due to its financial metrics and competitive landscape. Investors should closely observe the company's ability to improve its free cash flow and reduce its debt burden to warrant a more positive assessment.
Business Strategy & Overview
Sunoco LP operates primarily in the fuel distribution and marketing sector, purchasing motor fuel from refiners and supplying it to a network of independently operated dealer stations, distributors, and company-operated retail locations. This core business model generates revenue through the sale of gasoline and other fuels, as well as through retail operations that offer merchandise, foodservice, and other services. The company's strategy centers on maintaining a strong distribution network and optimizing its retail operations to maximize profitability.
A key aspect of Sunoco's strategy involves managing its relationships with independent dealers and distributors, ensuring a consistent supply of fuel and maintaining brand standards. The company also focuses on expanding its retail footprint and enhancing the customer experience at its retail locations, offering a variety of products and services to attract and retain customers. This includes investments in technology and infrastructure to improve operational efficiency and customer service.
Sunoco's diversification into retail stores, particularly in Hawaii and New Jersey, provides an additional revenue stream and helps to mitigate the risks associated with fluctuations in fuel prices. These retail locations offer a range of products and services, including convenience store items, foodservice, and other amenities such as car washes and ATMs. The company's ability to effectively manage these retail operations is crucial to its overall profitability.
The company also engages in leasing and subleasing real estate properties and operating terminal facilities in Hawaii, further diversifying its revenue streams and enhancing its operational capabilities. These activities contribute to Sunoco's overall stability and provide opportunities for growth in related sectors. However, the company's reliance on the petroleum and natural gas industry exposes it to regulatory changes, environmental concerns, and shifts in consumer demand for alternative fuels.
Execution Benchmarks audit
Revenue Growth
YOY expansion rate
-2.3%
Sector: -1.2%
+97% VS SCTR
Economic Moat Analysis
Sunoco LP's economic moat can be classified as Narrow. The company benefits from certain advantages within its specific market segments, but these advantages are not substantial enough to create a wide and sustainable competitive edge. The primary source of Sunoco's narrow moat lies in its established distribution network and brand recognition, particularly in the regions where it has a significant presence.
The company's extensive network of dealer stations and distributors creates a barrier to entry for new competitors, as it would be difficult and costly to replicate such a widespread distribution system. This network allows Sunoco to efficiently supply fuel to a large customer base and maintain a consistent market presence. However, this advantage is limited by the fact that other major fuel distributors also have well-established networks, and independent dealers can switch suppliers if they find better terms elsewhere.
Brand recognition also contributes to Sunoco's narrow moat, as the company's brand is well-known and trusted by many consumers. This brand loyalty can help to attract and retain customers, particularly at its retail locations. However, brand recognition is not a strong enough moat on its own, as consumers are often price-sensitive and willing to switch to other brands if they offer lower prices or better convenience.
Sunoco's retail operations, which offer a variety of products and services in addition to fuel, provide a further source of competitive advantage. These retail locations can attract customers who are looking for convenience and a one-stop shopping experience. However, this advantage is also limited by the fact that other convenience stores and gas stations offer similar products and services, and competition in the retail sector is intense.
Overall, Sunoco's narrow moat is based on a combination of its distribution network, brand recognition, and retail operations. While these advantages provide some degree of competitive protection, they are not strong enough to create a wide and sustainable moat. The company faces significant competition from other major fuel distributors and convenience store chains, and its profitability is sensitive to fluctuations in fuel prices and consumer demand.
Financial Health & Profitability
Sunoco LP's financial health presents a mixed picture. While the company generates substantial revenue, its profitability metrics lag behind the energy sector average. The TTM revenue stands at $25.20 billion, but the net income is $527 million, resulting in a net margin of only 2.0%, significantly lower than the sector average of 6.3%. Similarly, the operating margin of 3.9% is considerably below the sector's 10.6%. This suggests that Sunoco faces challenges in converting revenue into profit, potentially due to high operating costs or competitive pricing pressures.
A significant concern is the company's negative free cash flow of -$1.30 billion. This indicates that Sunoco is spending more cash than it is generating, which could strain its financial resources and limit its ability to invest in growth opportunities. The negative free cash flow is particularly concerning given the company's high debt levels.
Sunoco's balance sheet reveals a substantial debt burden, with total debt amounting to $13.37 billion and total cash at $3.24 billion. This results in a high debt-to-equity ratio of 167.00, significantly exceeding the sector average of 55.00. While the current ratio of 1.38 suggests that the company has sufficient liquid assets to cover its short-term liabilities, the high debt levels pose a risk, particularly if interest rates rise or if the company's earnings decline.
Analyzing the quarterly financial history reveals some volatility in Sunoco's performance. Revenue has fluctuated over the past few years, with a slight decrease of -2.3% TTM compared to the sector's -1.7%. Net income has also varied, with a notable increase in FY2024 ($874 million) compared to FY2023 ($394 million), but a decrease in the most recent TTM period ($527 million). Gross margins have shown some improvement, increasing from 5.9% in FY2023 to 11.1% in the most recent TTM period. However, operating margins have remained relatively stable, indicating that the company's cost structure is not improving as rapidly as its gross margins.
Overall, Sunoco's financial health is characterized by high revenue, low profitability, negative free cash flow, and high debt levels. While the company has demonstrated some improvement in gross margins, its overall financial performance remains a concern. Investors should closely monitor Sunoco's ability to improve its profitability, generate positive free cash flow, and reduce its debt burden.
Valuation Assessment
Sunoco LP's valuation metrics present a mixed picture, suggesting that the stock is neither significantly undervalued nor overvalued relative to its peers and historical performance. The company's P/E ratio of 28.2x is higher than the energy sector average of 19.5x, indicating that investors are paying a premium for Sunoco's earnings. However, this premium may be justified by the company's stability and established market position.
The EV/EBITDA ratio of 6.8x is also higher than the sector average of 3.5x, further suggesting that Sunoco is relatively expensive compared to its peers. This could be due to the market's perception of Sunoco's lower growth prospects or higher risk profile. However, it's important to note that EV/EBITDA can be influenced by a company's capital structure, and Sunoco's high debt levels may be contributing to its higher EV/EBITDA ratio.
Given the negative free cash flow, a traditional FCF yield analysis is not applicable. This lack of positive free cash flow is a significant concern and makes it difficult to assess the company's valuation based on its ability to generate cash. Investors should carefully consider the reasons for the negative free cash flow and assess whether it is likely to improve in the future.
Considering these valuation metrics in conjunction with Sunoco's financial health and growth prospects, it appears that the stock is fairly valued at its current price. The higher P/E and EV/EBITDA ratios suggest that the market is pricing in some degree of stability and brand recognition, but the negative free cash flow and high debt levels limit the potential for significant upside. A more attractive valuation would likely require improvements in profitability, free cash flow generation, and debt reduction.
The BCR proprietary quant model assigns a Value score of 56/100, which aligns with the assessment that the stock is fairly valued. This score suggests that Sunoco is not significantly undervalued or overvalued based on its current financial metrics. Investors should closely monitor the company's performance and adjust their valuation expectations accordingly.
Risk & Uncertainty
Sunoco LP faces several specific risks that could negatively impact its business and financial performance. One of the most significant risks is its high debt levels. The company's substantial debt burden increases its vulnerability to rising interest rates and economic downturns. If interest rates increase, Sunoco's debt servicing costs would rise, reducing its profitability and cash flow. An economic downturn could reduce demand for fuel, further straining the company's financial resources.
Another key risk is the volatility of fuel prices. Sunoco's profitability is sensitive to fluctuations in the price of gasoline and other fuels. If fuel prices decline, the company's revenue and earnings could decrease. Conversely, if fuel prices rise, the company may face resistance from consumers and retailers, potentially reducing sales volume. The company attempts to mitigate this risk through hedging strategies, but these strategies may not fully protect it from price volatility.
Competition in the fuel distribution and retail sectors is also a significant risk. Sunoco faces intense competition from other major fuel distributors, convenience store chains, and independent gas stations. This competition could lead to price wars, reduced margins, and loss of market share. The company must continuously innovate and improve its operations to remain competitive.
Regulatory and environmental risks also pose a threat to Sunoco's business. The petroleum and natural gas industry is subject to extensive regulations, including environmental regulations, safety regulations, and tax regulations. Changes in these regulations could increase the company's costs and reduce its profitability. Environmental concerns and the growing demand for alternative fuels could also reduce demand for Sunoco's products over the long term.
Finally, concentration risk is present, as a significant portion of Sunoco's revenue is derived from a relatively small number of customers and suppliers. The loss of one or more of these key customers or suppliers could have a material adverse effect on the company's business and financial performance.
Bulls Say / Bears Say
The Bull Case
BULL VIEWSunoco's established distribution network and brand recognition provide a stable revenue stream and a competitive advantage in key markets.
BULL VIEWThe company's focus on retail operations and diversification into convenience store offerings enhances profitability and mitigates the impact of fuel price volatility.
BULL VIEWSunoco's high Stability score (87/100) suggests resilience to market downturns and a lower risk profile compared to other energy companies.
The Bear Case
BEAR VIEWSunoco's high debt levels and negative free cash flow raise concerns about its financial flexibility and ability to invest in future growth.
BEAR VIEWThe company's relatively low profitability compared to the energy sector average indicates operational inefficiencies and competitive pressures.
BEAR VIEWThe declining revenue growth and reliance on commodity-driven products expose Sunoco to market volatility and long-term secular decline in fossil fuel demand.
About the Author
Marques Blank
Founder & Chief Investment Officer, Blank Capital
Marques brings 15 years of institutional finance and investing experience, having overseen financial planning for a $1.6B defense business unit. He developed the proprietary 6-factor quantitative model used to score SUN and 4,400+ other equities.
Sunoco LP exhibits a 206% valuation premium relative to institutional benchmarks. This represents a potential valuation overextension based on current multiples.
Return on Assets
Efficiency of asset utilization
1.5%
Sector: 3.7%
Gross Margin
Pricing power and cost efficiency
10.3%
Sector: 52.7%
Operating Margin
Core business profitability
3.9%
Sector: 10.7%
Net Margin
Bottom-line profitability
2.0%
Sector: 6.4%
Factor Methodology
The Quality factor evaluates the persistence and magnitude of cash flows. Companies with scores >70 exhibit superior competitive moats and financial resilience through economic cycles.
Sector Avg Yield1.89%
Yield Delta+284%
Income Projection audit
A $10,000 investment would generate approximately $726 annually in dividends at the current trailing rate.
