Sunoco LP Common Units representing limited partner interests (SUN) Company Bio
Sunoco LP engages in the wholesale distribution and retail sale of motor fuels primarily in Texas, New Mexico, Oklahoma, Louisiana, Kansas, Maryland, Virginia, Tennessee, Georgia, and Hawaii. It operates through two segments, Wholesale and Retail. The company was founded in 2014 and is based in Houston, Texas.
SUN Price Forecast Based on DCF Valuation
DCF Fair Value Target:
We started the process of determining a valid price forecast for Sunoco LP with a discounted cash flow analysis -- the results of which can be found in the table below. To summarize, we found that Sunoco LP ranked in the 86th percentile in terms of potential gain offered. Specifically, our DCF analysis implies the stock is trading below its fair value by an estimated 1055.67%. In terms of the factors that were most noteworthy in this DCF analysis for SUN, they are:
40% of the company's capital comes from equity, which is greater than merely 16.5% of stocks in our cash flow based forecasting set.
Sunoco LP's effective tax rate, as measured by taxes paid relative to net income, is at 0 -- greater than just 0% of US stocks with positive free cash flow.
The weighted average cost of capital for the company is 8. This value is greater than only 20.45% stocks in the Energy sector that generate free cash flow.
Terminal Growth Rate in Free Cash Flow
Return Relative to Current Share Price
For other companies in the Energy that have a similar discounted cashflow valuation profile (and ensuing price forecasts) as SUN, try NCSM, HP, VET, SHLX, and DWSN.
Energy Transfer (ET) management is not done yet giving either the partnership or the midstream industry a black eye (or maybe several) by a longshot. In the meantime, the long suffering unitholders are about to endure a whole new level of suffering while possibly costing the industry a very economical...
Thesis Businesses are inherently risky. One of the primary risks of any business is the reduction in demand for its products. For businesses operating in the cost leadership domain, a shift in the demand curve for its products/services will lead to reduction in product prices and eventually company profits. However,...
Rohit Acharya on Seeking Alpha | September 1, 2020
Sunoco LP (NYSE: SUN) ("SUN" or the "Partnership") announced today that Thomas R. Miller, Chief Financial Officer, will retire from Sunoco GP LLC, the general partner of Sunoco LP, as of September 1, 2020.