Stifel analyst Selman Akyol upgraded Sunoco LP (NYSE SUN) to Buy from Hold and maintained a price target of $62.00.
The analyst writes that Sunoco's unit price has dropped by 13% since mid-February, presenting an attractive re-entry point.
Akyol notes that management's upcoming guidance, expected around second-quarter FY24 earnings, could catalyze the unit price.
This guidance will likely offer a comprehensive update on the 2024 outlook for its legacy business, NuStar assets, and potential synergies, stated analyst.
While the analyst do not foresee changes to the IDR structure, they expect Sunoco to derive additional value from the NuStar assets, potentially with Energy Transfer as a partner.
Year to date, SUN units have declined by 9%, while the AMZ index has seen a 10% increase, writes the analyst.
Akyol estimates EBITDA of $1.48 billion in FY24 and $1.79 billion in FY25.
Investors can gain exposure to the stock via InfraCap MLP ETF
Price Action: SUN shares are down 0.90% at $54.01 at the last check Friday.
