Operating Margin - Sunoco LP (NYSE:SUN)

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Price: 52.31 USD -2.08%

Market Cap: 7.1B USD

4.6%

Current

Average

10.5%

Industry

Operating Margin represents how efficiently a company is able to generate profit through its core operations.

Higher ratios are generally better, illustrating the company is efficient in its operations and is good at turning sales into profits.

Operating Margin

4.6%

Operating Profit

997m

Revenue

21.9B

Operating Margin Across Competitors

Country		Company	Market Cap	Operating Margin
US		Sunoco LP NYSE:SUN	7.1B USD	5%
IN		Reliance Industries Ltd NSE:RELIANCE	20.9T INR	12%
US		Marathon Petroleum Corp NYSE:MPC	53.5B USD	5%
US		Phillips 66 NYSE:PSX	52.7B USD	2%
US		Valero Energy Corp NYSE:VLO	48.9B USD	3%
PL	O	Orlen SA PSE:PKN	622.3B CZK	10%
PL		Polski Koncern Naftowy Orlen SA WSE:PKN	106.9B PLN	10%
IN		Indian Oil Corporation Ltd NSE:IOC	2.3T INR	4%
JP		ENEOS Holdings Inc TSE:5020	2.9T JPY	0%
IN		Bharat Petroleum Corporation Ltd NSE:BPCL	1.6T INR	5%
FI		Neste Oyj OMXH:NESTE	14B EUR	1%

Sunoco LP
Glance View

Economic Moat

None

Market Cap

7.1B USD

Industry

Energy

Sunoco LP stands as a significant player in the U.S. energy landscape, deeply entrenched in the complex web of fuel distribution that powers businesses and consumers alike. Originally rooted in Pennsylvania, the company has evolved from its historical ties with Sun Oil into a robust partnership that focuses on the wholesale distribution of motor fuels. In essence, Sunoco LP operates as a critical intermediary between fuel producers and an array of retail outlets, including convenience stores and commercial fleet operators. The firm's operations extend across multiple states, leveraging strategic logistics and supply infrastructure to ensure a consistent, reliable flow of gasoline and diesel. This capability not only supports nearly 76 distribution terminals but also fosters a comprehensive network that efficiently meets the varied demands of its customers. The company's revenue model is primarily anchored in the sale of fuel, constituting the lion's share of its earnings. By handling an array of branded and unbranded fuels, Sunoco LP maximizes its market presence, catering to different segments with varying needs and preferences. Alongside fuel distribution, the company garners income from its vast real estate holdings associated with retail and wholesale operations. This is complemented by auxiliary services, such as credit card processing and a suite of logistics solutions to simplify fuel management for its partners. Together, these elements create a diversified portfolio, stabilizing revenue streams even amid volatile energy markets. In navigating the challenges of an evolving energy sector, Sunoco LP remains committed to enhancing efficiency and sustaining its competitive edge through strategic partnerships and continuous network optimization.

View SUN Analysis

SUN Intrinsic Value

What is Intrinsic Value?

Economic Moat is a concept popularized by Warren Buffett to describe a company's durable competitive advantage. It represents the 'moat' that protects a company from competitors and helps it sustain profitability over the long term. Our analysis of the past 10 years showed that companies with a wide economic moat significantly outperformed the market, delivering +645% returns compared to +189% for the S&P 500.

Our research into Economic Moat performance spans the past 10 years and focuses on companies with a wide economic moat. For this analysis, we calculated the average stock price returns of these companies, comparing them to the performance of the S&P 500 index over the same period.

The results were compelling: wide moat stocks achieved a remarkable +645% average return, compared to +188% for the broader market. This difference highlights the long-term benefits of investing in businesses that can maintain their market position and pricing power over time.

Note: This research does not account for survivorship bias. Past performance is not indicative of future results.

Determining whether a company has an economic moat requires both a deep dive into financial metrics and a qualitative assessment of its competitive position. Our analysts conduct a rigorous evaluation that focuses on identifying structural advantages that enable a company to sustain profitability and defend its market share over the long term.

The process begins with an analysis of a company’s historical financial performance. We assess how consistently the company has generated returns above its cost of capital and whether those returns have been stable or improving. However, financial performance alone doesn’t reveal the full picture. To understand the sources of these advantages, we evaluate five key drivers of economic moats:

Network Effect: We analyze whether the value of a company’s product or service grows as its user base expands. Platforms like payment systems or marketplaces benefit from this self-reinforcing.

Switching Costs: We assess whether customers face significant costs or disruptions when switching to a competitor’s product or service. High switching costs create customer stickiness and provide pricing power.

Intangible Assets: Strong brands, patents, and regulatory licenses can protect a company’s market position by creating barriers for competitors or enabling premium pricing. For example, a well-recognized consumer brand may command higher customer loyalty and margins.

Efficient scale: Occurs when a market is optimally served by one or a few players, making it unprofitable for new entrants to compete. This typically happens in industries with high fixed costs or geographic constraints, such as utilities or pipelines.

Cost Advantage: Companies with structural cost advantages can produce goods or services at a lower cost than their competitors, enabling them to offer competitive pricing or maintain higher margins. These advantages often arise from economies of scale, superior supply chain management, or proprietary technology. Firms like Walmart leverage their massive scale to negotiate better terms with suppliers, allowing them to undercut competitors on price.

By examining these factors in combination with a company’s financial performance and market positioning, we classify each company into one of three categories:

This rigorous evaluation ensures that our moat ratings are both comprehensive and reliable, giving investors the tools they need to make well-informed, long-term decisions.

The AI Assistant may sometimes provide inaccurate information.

Make your own investment decisions or consult a licensed financial advisor.

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US	Berkshire Hathaway Inc NYSE:BRK.A	Financial Services
US	Bank of America Corp NYSE:BAC	Banking
US	Mastercard Inc NYSE:MA	Technology
US	UnitedHealth Group Inc NYSE:UNH	Health Care
US	Exxon Mobil Corp NYSE:XOM	Energy
US	Pfizer Inc NYSE:PFE	Pharmaceuticals
US	Palantir Technologies Inc NYSE:PLTR	Technology
US	Nike Inc NYSE:NKE	Textiles, Apparel & Luxury Goods
US	Visa Inc NYSE:V	Technology
CN	Alibaba Group Holding Ltd NYSE:BABA	Retail
US	JPMorgan Chase & Co NYSE:JPM	Banking
US	Coca-Cola Co NYSE:KO	Beverages
US	Walmart Inc NYSE:WMT	Retail
US	Verizon Communications Inc NYSE:VZ	Telecommunication
US	Chevron Corp NYSE:CVX	Energy

	Johnson & Johnson NYSE:JNJ	US
	Berkshire Hathaway Inc NYSE:BRK.A	US
	Bank of America Corp NYSE:BAC	US
	Mastercard Inc NYSE:MA	US
	UnitedHealth Group Inc NYSE:UNH	US
	Exxon Mobil Corp NYSE:XOM	US
	Pfizer Inc NYSE:PFE	US
	Palantir Technologies Inc NYSE:PLTR	US
	Nike Inc NYSE:NKE	US
	Visa Inc NYSE:V	US
	Alibaba Group Holding Ltd NYSE:BABA	CN
	JPMorgan Chase & Co NYSE:JPM	US
	Coca-Cola Co NYSE:KO	US
	Walmart Inc NYSE:WMT	US
	Verizon Communications Inc NYSE:VZ	US
	Chevron Corp NYSE:CVX	US

	Johnson & Johnson NYSE:JNJ	209.45 USD 0.07%
	Berkshire Hathaway Inc NYSE:BRK.A	753 586 USD 0.08%
	Bank of America Corp NYSE:BAC	55.08 USD 0.49%
	Mastercard Inc NYSE:MA	570.74 USD 0.83%
	UnitedHealth Group Inc NYSE:UNH	335 USD 0.24%
	Exxon Mobil Corp NYSE:XOM	116.04 USD 1.19%

	Franklin Covey Co NYSE:FC	16.31 USD 0.55%
	Mohawk Industries Inc NYSE:MHK	111 USD 0.63%
	Ardmore Shipping Corp NYSE:ASC	11.14 USD -0.18%
	ASGN Inc NYSE:ASGN	47.75 USD -0.42%
	Skyworks Solutions Inc NASDAQ:SWKS	65.57 USD -0.68%
	Weatherford International PLC NASDAQ:WFRD	76.23 USD -3.49%

	Johnson & Johnson NYSE:JNJ	209.45 USD 0.07%
	Bank of America Corp NYSE:BAC	55.08 USD 0.49%
	Mastercard Inc NYSE:MA	570.74 USD 0.83%
	Salesforce Inc NYSE:CRM	260.74 USD 2.29%
	Abbvie Inc NYSE:ABBV	224.12 USD 0.2%
	Home Depot Inc NYSE:HD	355.02 USD 0.66%

Sunoco LP
NYSE:SUN