Barclays maintains Sunoco stock Overweight with $59 target

Published 27/01/2025, 17:08
Barclays maintains Sunoco stock Overweight with $59 target

The firm acknowledges that Sunoco faces downside risks, which could stem from a negative shift in commodity market conditions or the economics of potential future projects and mergers and acquisitions. Nonetheless, Barclays (LON:BARC)' current assessment underscores a belief in Sunoco's resilience and margin durability, which have been proven through the company's execution during various market conditions. For a deeper analysis of Sunoco's risk factors and comprehensive financial health assessment, investors can access detailed research reports and proprietary financial health scores through InvestingPro. For a deeper analysis of Sunoco's risk factors and comprehensive financial health assessment, investors can access detailed research reports and proprietary financial health scores through InvestingPro.

The firm acknowledges that Sunoco faces downside risks, which could stem from a negative shift in commodity market conditions or the economics of potential future projects and mergers and acquisitions. Nonetheless, Barclays' current assessment underscores a belief in Sunoco's resilience and margin durability, which have been proven through the company's execution during various market conditions. For a deeper analysis of Sunoco's risk factors and comprehensive financial health assessment, investors can access detailed research reports and proprietary financial health scores through InvestingPro.

The firm acknowledges that Sunoco faces downside risks, which could stem from a negative shift in commodity market conditions or the economics of potential future projects and mergers and acquisitions. Nonetheless, Barclays' current assessment underscores a belief in Sunoco's resilience and margin durability, which have been proven through the company's execution during various market conditions.

In other recent news, Sunoco LP has witnessed significant developments. RBC Capital Markets maintained an Outperform rating on Sunoco's shares, raising the price target from $63.00 to $64.00, citing updated estimates and growth potential. Sunoco's strategic moves, including the acquisition of NuStar and a joint venture with Energy Transfer (NYSE:ET), have been instrumental in this positive outlook.

Sunoco reported a record third-quarter adjusted EBITDA of $470 million, indicating strong performance despite one-time expenses. The company maintained its quarterly distribution at $0.8756 per unit and reported a healthy coverage ratio of 2.3x for the quarter. Sunoco's Fuel Distribution segment saw an 8% year-over-year increase in adjusted EBITDA, reaching $253 million, demonstrating the beneficial integration of NuStar assets.

The company is also exploring further growth and acquisitions in the fuel distribution and midstream sectors. RBC Capital Markets has revised upward the financial forecasts for Sunoco, expecting the company to present a promising 2025 outlook. The updated projections include Adjusted EBITDA figures for the years 2024, 2025, and 2026 at $1,573 million, $1,913 million, and $1,985 million, respectively.

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