Stock Research and Analysis

by Stephen Simko, CFA

Bulls Say

Crude oil and natural gas liquids production in shale plays provide Sunoco Logistics with opportunities to extend its pipeline network and collect attractive fee-based cash flows.
Sunoco Logistics' core pipeline business has a wide moat on its own and generates healthy cash flow each year.
We expect 15% average annual distributions through 2019--cash flows have just stepped up to a new level, and multiple new projects look poised to add inflows, supporting rapid distribution growth. Read more 

Bears Say

Like all partnerships that pay out a large percentage of their cash flow, Sunoco Logistics cannot accumulate significant amounts of cash in a war chest for growth or acquisitions. It depends to some extent on external funding for growth.
Sunoco Logistics generates significant revenue from crude oil marketing, a low-margin business that can create cash flow volatility relative to peers as commodity prices swing.
ETP may seek to use Sunoco Logistics as a currency, selling assets into it that are not a strategic fit and at a higher price than Sunoco Logistics would otherwise seek to pay. Read more 


Historically, SXL has been a good steward of capital for its unitholders, and we see no reason to expect this to change now that SXL's general partner is Energy Transfer Partners. SXL is headed by Michael Hennigan, who stepped into his role in March   Read more 


Sunoco Logistics Partners was spun off from Sunoco in an initial public offering in February 2002. It holds a portfolio of crude and refined products pipelines and terminals   Read more 

The 3 Best MLPs to Ride Out the Energy Downturn 
Watch more 

Premium Membership

View all of our analyst reports with a free trial to Premium.