Sunoco (SUN) Earnings and Revenues Beat Estimates in Q4

Sunoco LP SUN reported fourth-quarter 2019 earnings per unit from continuing operations of 75 cents, beating the Zacks Consensus Estimate of 62 cents. In the year-ago quarter, the partnership reported loss from continuing operations of $1.11 per unit.

Quarterly revenues of the partnership totaled $4,098 million, beating the Zacks Consensus Estimate of $3,995 million. Also, the figure improved from $3,877 million recorded in the prior-year quarter.

The strong fourth-quarter results were backed by higher contributions from fuel distribution and marketing business.

Sunoco LP Price, Consensus and EPS Surprise

 

Sunoco LP Price, Consensus and EPS Surprise

Sunoco LP price-consensus-eps-surprise-chart | Sunoco LP Quote

Segmental Performance

The partnership reports financial statements through two reportable segments — Fuel Distribution and Marketing, and All Other.

Fuel Distribution and Marketing: Total gross profit from the segment increased to $243 million from $127 million in the comparable period of 2018, primarily due to higher Motor fuel sales.

All Other: This unit reported gross profit of $42 million compared with $56 million in the comparable period of 2018. The year-over-year decline can be attributed to lower Motor fuel sales.

In terms of volumes, the partnership sold 2.1 billion gallons of fuel in the reported quarter, up 3% year over year. Motor fuel gross profit per gallon was recorded at 9.9 cents in the quarter, lower than the year-ago level of 12.4 cents.

Distribution

For the quarter ended Dec 31, 2019, Sunoco declared a quarterly cash distribution of 82.55 cents per unit, or $3.3020 on an annualized basis. Markedly, this distribution is flat on a sequential basis.

Expenses

Total cost of sales and operating expenses in the reported quarter increased to $4,000 million from $3,915 million in the year-ago period.

Capital Expenditure

The partnership incurred gross capital expenditure of $45 million in the quarter under review, including $28 million in growth capital and $17 million in maintenance capital.

Balance Sheet

As of Dec 31, 2019, Sunoco had cash and cash equivalents of $21 million, and a net long-term debt of $2,898 million. Its debt-to-capitalization ratio was 79.3%.

Zacks Rank & Other Stocks to Consider

Sunoco LP currently carries a Zacks Rank #2 (Buy). Other prospective players in the energy sector include Denbury Resources Inc. DNR, Chevron Corporation CVX and Hess Corporation HES, each carrying a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Denbury Resources’ earnings per share estimate of 30 cents for 2020 has been unchanged over the past seven days.

Chevron’s bottom line for 2020 is expected to rise 12.8% year over year.

Hess’ bottom line for 2020 is likely to grow 93.7% year over year.

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