Why Is Murphy USA (MUSA) Down 10.2% Since Last Earnings Report?

Core Viewpoint - Murphy USA's recent earnings report shows a mixed performance, with strong merchandise sales but declining petroleum product sales, leading to a decrease in overall revenues and profit margins [2][3][4]. Financial Performance - The company reported Q4 2024 earnings per share of $6.96, exceeding the Zacks Consensus Estimate of $6.43, but down from $7 in the previous year due to weak petroleum sales [2]. - Operating revenues were $4.7 billion, a 7.1% decline year over year, missing the consensus estimate by $169 million [2]. - Petroleum product sales were $3.6 billion, down 9.6% from Q4 2023 and below the estimated $4.1 billion [3]. Sales Contribution - Total fuel contribution decreased by 1% year over year to $389.1 million, with retail fuel margins contracting [4]. - Retail fuel contribution fell 8% year over year to $345.8 million, with margins narrowing to 28.9 cents per gallon from 31.1 cents [5]. - Merchandise sales increased by 3.2% year over year to $1.1 billion, with a contribution of $208.8 million, up 5.6% due to higher sales and improved unit margins [3][6]. Operational Metrics - Retail gallons sold declined by 1% year over year to 1,196.8 million, missing estimates [5]. - Monthly fuel gallons fell 2.4% from the prior year, while merchandise sales increased by 2% on a per store basis [7]. Balance Sheet - As of December 31, the company had cash and cash equivalents of $47 million and long-term debt of $1.8 billion, with a debt-to-capitalization ratio of 68.6% [8]. - The company repurchased shares worth $126.2 million during the quarter [8]. Market Sentiment - There has been a downward trend in estimates, with a consensus estimate shift of -14.37% in the past month [9]. - Murphy USA holds a Zacks Rank 3 (Hold), indicating expectations for an in-line return in the coming months [12]. Investment Scores - The company has a strong Growth Score of A but a low Momentum Score of F, with an overall VGM Score of A, placing it in the top quintile for value investment strategy [11].