Sunoco LP Common Units representing limited partner interests (SUN)

FairStock Score: 41/100 — MIXED

Key Financials

Strengths

• Generates $34 million in annual free cash flow (0.3% yield on market cap)
• Revenue growth of 63.2% demonstrates strong top-line momentum
• Attractive 5.7% dividend yield providing steady income returns

Concerns

• Altman Z-Score of 0.8 places it in the financial distress zone—elevated bankruptcy risk

AI Analysis

Sunoco LP Common Units representing limited partner interests is a mid-cap energy company valued at $12.4 billion. The business generates $25.2 billion in annual revenue with a 0.3% net margin and $34 million in free cash flow. From a quality standpoint, Sunoco shows distressed Altman Z-Score of 0.8 warrants caution and modest 9% ROE. On valuation, the stock is trading at a premium 29.0x earnings, with trades above its Graham Number with a negative 41% margin. Growth dynamics show revenue growing at 63.2% and profit growth of -209.7%. The 5.7% dividend yield adds an income component for patient holders. Our composite FairStock Score of 41/100 reflects below-average fundamentals overall. Investors should weigh the business quality against the current price and their own margin of safety requirements.

Bull Case

Sunoco's 63% revenue growth trajectory could accelerate as it captures additional market share in the energy sector. With $34 million in annual free cash flow (0.3% yield), management has ample capital for buybacks, dividends, or accretive acquisitions.

Bear Case

Macro headwinds or sector-specific disruption could pressure margins, particularly if competitive intensity increases in the energy space. Regulatory changes, input cost inflation, or demand normalization represent underappreciated risks that could materially impact forward estimates.

Data from SEC filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer