Murphy USA stock price target lowered to $460 at KeyBanc on fuel margin concerns

Investing.com - KeyBanc has lowered its price target on Murphy USA (NYSE:MUSA) to $460 from $480 while maintaining an Overweight rating, citing concerns about fuel margins and volume. The stock, currently trading at $365.72, is near its 52-week low of $345.23, though according to InvestingPro analysis, the company maintains a ’FAIR’ overall financial health score.

The firm reduced its third-quarter earnings estimates for Murphy USA based on projected fuel margins of 20.4 cents per gallon, potentially $0.02 below consensus, compared to 21.6 cents per gallon in the second quarter. KeyBanc noted that July and September showed stronger margins while August was softer. With a gross profit margin of 7.55% and revenue declining 9.04% over the last twelve months, the company faces near-term challenges ahead of its earnings report on October 29.

Geolocation data indicated improved traffic in September (-4.7%) compared to August (-8.3%) and July (-6.5%), though the quarter overall appeared weak. The firm lowered its fuel same-store sales volume estimate to -2.5% from its previous -0.5% forecast.

KeyBanc highlighted some positive factors, including Murphy USA’s September promotion with ZYN that offered a free can with the purchase of another nicotine product. The firm estimated this promotion likely added $10-20 million to third-quarter gross profit, noting that about 60% of Murphy USA’s merchandise sales are associated with nicotine products.

Despite near-term challenges from low gasoline prices, KeyBanc maintained a positive long-term outlook for Murphy USA, expecting the company to gain market share through store growth and improve comparable sales when gasoline prices eventually rise. InvestingPro data reveals management’s confidence through aggressive share buybacks, with the company trading at a P/E ratio of 15.69. For deeper insights into Murphy USA’s financial health and growth prospects, including 8 additional exclusive ProTips, check out the comprehensive Pro Research Report available on InvestingPro.

In other recent news, Murphy USA reported its second-quarter 2025 earnings, highlighting a decline in fuel volumes. The company is focusing on improving margins and operational efficiencies amid a challenging market environment. Despite these efforts, the market reacted with a slight dip in aftermarket trading. In addition to the earnings report, Murphy USA announced the departure of Chief Financial Officer Galagher Jeff, effective October 14, 2025. The company clarified that Jeff’s exit was not due to any disagreement regarding its operations, financial performance, or condition. However, investors expressed concerns over the sudden leadership change. These developments have drawn attention from various analyst firms, which are closely monitoring the company’s adjustments and strategic direction.

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