The company, which owns and operates a logistics business used to facilitate the purchase and sale of crude oil and refined products, has diversified its asset base and shows signs of sustainable growth, analysts said.
"Since 2011, Sunoco has broadened its footprint, diversified its asset base, and replaced acquisition-driven growth with organically sourced expansions," analysts said.
"We believe its current assets and project inventory will underpin distribution growth through at least 2019 and note its strong relationship with Energy Transfer Partners LP (ETP) and early-mover logistical advantage," analysts added.
Shares of Sunoco are down 0.02% to $50.16.
Separately, TheStreet Ratings team rates SUNOCO LOGISTICS PARTNERS LP as a Buy with a ratings score of A. TheStreet Ratings Team has this to say about their recommendation:
"We rate SUNOCO LOGISTICS PARTNERS LP (SXL) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, reasonable valuation levels, solid stock price performance and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The revenue growth came in higher than the industry average of 6.4%. Since the same quarter one year prior, revenues slightly increased by 8.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
- The current debt-to-equity ratio, 0.53, is low and is below the industry average, implying that there has been successful management of debt levels.
- Powered by its strong earnings growth of 122.22% and other important driving factors, this stock has surged by 45.14% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SXL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 98.7% when compared to the same quarter one year prior, rising from $78.00 million to $155.00 million.
- You can view the full analysis from the report here: SXL Ratings Report