Sunoco LP (NYSE: $SUN) announced on Thursday, January 11, 2024, that it would sell around $1 billion worth of assets to 7-Eleven. The sale will involve 204 convenience stores in New Mexico, West Texas, and Oklahoma.
Details of the Sale
Sunoco will amend its existing take-or-pay fuel supply deal with 7-Eleven to incorporate any additional fuel gross profit as part of the deal. The sale will see Laredo Taco Company restaurants and Stripe convenience stores added to the over 13,000 Speedway, 7-Eleven, and Stripes stores operated, franchised, and licensed across Canada and the US. Once concluded, 7-Eleven will be the owner and operator of all US Stripes and Laredo Taco Company locations.
Sunoco LP plans to use the proceeds from the sale to cut its leverage to execute future growth while maintaining a strong balance sheet. The deal will close once it receives regulatory approval and satisfies all closing conditions.
Sunoco to Acquire European Terminals
In the same announcement, Sunoco LP revealed that it would acquire Zenith Energy Netherlands Amsterdam B.V. The company owns fuel terminals in Bantry Bay, Ireland, and Amsterdam.
The Amsterdam terminal is located in the Port of Amsterdam, an international hub for the global energy market. Bantry Bay, Ireland’s largest bulk liquid storage terminal, stores the nation’s strategic oil reserves. They expect to close the transaction in Q1 2024, subject to closing conditions.
Sunoco LP also revealed the date of its next earnings report for Q4 and FY23. They will release it on Wednesday, February 14, 2024.
Sunoco Stock Performance
Sunoco (SUN) closed trading on January 11, 2024, 0.25% higher at $59.59 per share. The stock is trading below its 523-week high of $63.96. However, it is doing better than its 50-day and 200-day moving averages of $55.36 and $47.98, respectively. The stock’s value has risen 33.18% in the past 12 months and 34.48% in the past six months. It has a market cap of $5.01 billion.
Sunoco Stock Forecast: $SUN
Stock analysts give SUN an average buy rating. They project a high of $55 and a low of $48. Their average target for SUN stock is $50.71, a 14.83% decline based on the last closing price.
Should You Buy SUN Stock?
Sunoco stock’s value has risen by 33.18% in the past 12 months, outperforming the rest of the sector. While analysts’ average prediction is that the stock will fall in value, there is a chance that it will outperform the market once more.
The company has remained profitable, and with the latest cash injection, it could expand its core business, growing profits for its investors. Consequently, SUN stock is a great option as a long-term investment.
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