Is Sunoco (SUN) Undervalued After Strong Earnings And Higher 2026 EBITDA Guidance?

Sunoco (SUN) attracted fresh attention after its latest quarterly earnings, which featured higher revenues and net income tied to acquisitions and fuel volumes, along with an increase in 2026 adjusted EBITDA guidance.

Over the past year, Sunoco’s share price has built strong momentum, with a year to date share price return of 43.37% and a 90 day share price return of 14.11%. The 1 year total shareholder return of 58.17% reflects how investors have reacted to the earnings driven guidance upgrade.

Look beyond Sunoco and compare this earnings-driven move with a hand picked group of value focused energy and infrastructure plays in our 47 high quality undervalued stocks.

For Sunoco, the recent surge can appear to stem from pure excitement about improved guidance or from a clearer view of a stronger underlying fuel and infrastructure business. The valuation section next helps you weigh which explanation fits better.

Most Popular Narrative: 8.4% Undervalued

Compared with the latest fair value estimate of about $82.57, Sunoco’s last close at $75.60 implies a discount that the current rally has not fully closed.

The NuStar and upcoming Parkland and TanQuid acquisitions are expected to deliver substantial double-digit accretion and cost synergies, further increasing operating leverage and net margins while materially enhancing Sunoco’s international and midstream asset footprint.

Read the complete narrative. Read the complete narrative.

It may be useful to consider what earnings curve and margin profile would need to align to support that fair value. The narrative focuses on faster profit growth than revenue and a lower future P/E multiple than many investors might assume. The combination of acquisition driven expansion, projected margin uplift, and a higher earnings base in later years is presented as the key driver in this framework.

Result: Fair Value of $82.57 (UNDERVALUED)

Have a read of the narrative in full and understand what’s behind the forecasts.

However, Sunoco’s acquisition-heavy approach and reliance on traditional fuel distribution also introduces integration, leverage, and long-term demand risks that could challenge this upbeat narrative.

Find out about the key risks to this Sunoco narrative.

Next Steps

With Sunoco attracting both optimism and concern, it makes sense to stress test the story against your own expectations and risk tolerance. Take a closer look at the balance of upside and downside by reviewing the 4 key rewards and 1 important warning sign.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data
and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your
financial situation. We aim to bring you long-term focused analysis driven by fundamental data.
Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material.
Simply Wall St has no position in any stocks mentioned.

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