"Mizuho raised its price target on Sunoco to $75 from $66 while keeping an Outperform rating, calling the setup for the fuel distribution giant 'intriguing.'"
"The combination of a high distribution yield, recent acquisition-driven scale, and lagged fuel margin pass-through creates a differentiated setup heading into Q1 2026 earnings."
"Sunoco's Q4 2025 results showcased the dynamic, with fuel margin expanding to 17.7 cents per gallon from 10.6 cents year over year, and fuel volumes jumping 54%."
"Management guided fiscal 2026 Adjusted EBITDA to $3.1 billion to $3.3 billion, targeting at least 5% annual distribution growth, reflecting contributions from recent acquisitions."
Mizuho increased its price target for Sunoco to $75, maintaining an Outperform rating. The firm noted that Sunoco's fiscal 2026 guidance was issued under different commodity conditions, with current crude volatility benefiting margins. The stock is appealing for income-focused investors due to its high distribution yield and recent acquisitions. Mizuho's analysis highlights the lagged pass-through dynamics of wholesale and retail pricing, which can create temporary margin advantages. Sunoco's recent performance showed significant growth in fuel margins and volumes, supported by strategic acquisitions.
Read at 24/7 Wall St.
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