Murphy USA MUSA is a retail gasoline station chain headquartered in El Dorado, Arkansas, United States. The company operates primarily in the United States, with a focus on the southern and midwestern regions. Murphy USA was established in 1996 as a subsidiary of Murphy Oil Corporation but became an independent entity in 2013.
Murphy USA is known for its strategic partnerships with large retailers like Walmart. Many of its gasoline stations are located adjacent to Walmart stores, which increases foot traffic and enhances convenience for customers. This partnership model has been a significant driver of Murphy USA’s growth and success.
In addition to selling gasoline, Murphy USA stations offer convenience store items, snacks, beverages, and other merchandise. Their convenience stores often feature well-known brands and offer a range of products to cater to various customer needs.
Murphy USA has been one of the premier energy stocks over the last decade, compounding at an annual rate of 26.3% and is set to continue to build its impressive business record. The stock currently boasts a Zacks Rank #1 (Strong Buy) rating, and with crude nearing $90/barrel has further catalysts for profit growth.
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Earnings Revision Trend
Analysts have made some hefty revisions to the earnings estimates over the last two months, especially if you are looking farther out. FY24 earnings estimates have increased by 6.6% and FY25 have climbed by 17.5%.
MUSA is also one of the few energy companies forecasting YoY growth in both earnings and sales. Because as a retailer, Murphy USA is less sensitive to the gyrations of the commodity market they enjoy steady growth. Whereas other oil companies have seen declines since the price of oil peaked back in 2022.
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Share Cannibal
Another good reason to own Murphy USA is that management is a massive buyer of its own stock. Shares outstanding have halved in the last 10 years, making shares scarce and putting a bid constantly beneath the stock.
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Valuation
Murphy USA stock is trading right in the center of its long-term average valuation, currently at 16x forward earnings. This is well below the market average and in line with its 10-year median of 16.3x.
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Bottom Line
Over the last decade, Murphy USA has been an extremely well positioned business and exceptional performing stock. It has many of the things a long-term investor looks for in a good business, and has the near-term catalyst of rising earnings estimates.
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Murphy USA Inc. (MUSA) : Free Stock Analysis Report
