Murphy USA
MUSA
$569.12
+1.06%
Murphy USA Inc. is a leading retailer of motor fuel and convenience merchandise, operating over 1,700 stores primarily in the Southwestern, Southeastern, Midwestern, and Northeastern United States, with a significant presence adjacent to Walmart Supercenters. The company differentiates itself through a low-cost, high-volume business model, offering competitive fuel prices and a growing QuickChek chain, positioning it as a dominant player in the convenience store sector. Currently, the stock is in focus due to its strong operational performance, with recent quarterly earnings showing robust growth, while investors debate the sustainability of fuel margins and the impact of broader economic conditions on consumer spending. The company's strategic expansion and share repurchase programs are also key narratives driving investor attention.…
MUSA
Murphy USA
$569.12
Investment Opinion: Should I buy MUSA Today?
We rate Murphy USA a Buy, as the stock offers a compelling risk/reward with a 17.7% upside to the average analyst target of $630.90 and a 26% discount to the industry PE. The company's strong Q1 2026 earnings growth (EPS up 156% YoY) and margin expansion (gross margin up 215 bps) demonstrate operational strength, while the low beta (0.276) provides stability. The consensus 'Buy' rating from 10 analysts, with 7 Buys, supports this view.
Sign up to view all
MUSA 12-Month Price Forecast
The AI assessment is bullish, driven by strong fundamental improvements and a valuation discount. However, confidence is medium due to the recent price drop and fuel margin volatility. The key factors are the exceptional earnings growth, margin expansion, and undervaluation relative to peers. If fuel margins hold and the company continues to execute, the stock could re-rate higher. Conversely, any sign of margin compression or a broader market selloff could undermine the thesis. We would upgrade to high confidence if the stock stabilizes above $550 and Q2 earnings confirm margin sustainability.
Wall Street consensus
Most Wall Street analysts maintain a constructive view on Murphy USA's 12-month outlook, with a consensus price target around $622.70 and implied upside of +9.4% versus the current price.
Average Target
$622.70
0 analysts
Implied Upside
+9.4%
vs. current price
Analyst Count
—
covering this stock
Price Range
$550 - $710
Analyst target range
Murphy USA has coverage from 10 analysts, with a consensus recommendation of 'Buy' and a mean rating of 2.0 (where 1 is Strong Buy and 5 is Sell). The average price target is $630.90, implying an upside of 17.7% from the current price of $536.18. The distribution includes 7 Buy ratings, 2 Hold, and 1 Sell, reflecting a generally bullish sentiment. The target price range spans from $550.00 (low) to $710.00 (high), with the high target suggesting a 32.4% upside, while the low target implies only a 2.6% upside. This wide spread indicates significant uncertainty about the company's future performance. Recent institutional actions show a mix of ratings, with KeyBanc maintaining Overweight, Wells Fargo downgrading from Overweight to Equal Weight in October 2025, and Raymond James downgrading from Outperform to Market Perform in May 2025. These mixed signals suggest that while analysts are generally positive, there are concerns about near-term headwinds, such as fuel price volatility and potential margin compression.
Bulls vs Bears: MUSA Investment Factors
Murphy USA presents a mixed picture: strong recent earnings and margin expansion are offset by high debt, fuel margin volatility, and a recent price drop. The bull case is supported by a compelling valuation (PE below industry) and analyst upside, while the bear case hinges on sustainability of fuel margins and potential earnings decline. Currently, the bull case has slightly stronger evidence given the fundamental improvements and valuation discount, but the key tension is whether fuel margins can hold up in a volatile oil price environment. If margins compress, the stock could face significant downside; if they persist, the stock is undervalued.
Bullish
- Strong Earnings Growth: Q1 2026 net income surged to $136.3M from $53.2M a year ago, a 156% increase, with EPS of $7.36 vs $2.67. This demonstrates exceptional operational leverage and margin expansion.
- Margin Expansion: Gross margin improved to 5.43% from 3.28% YoY, and operating margin doubled to 4.25% from 1.95%. This reflects better fuel margins and merchandise performance, driving profitability.
- Undervalued vs Peers: Trailing PE of 16.55x is 26% below the specialty retail industry average of 22.5x, and near the lower end of its 5-year range (6.9x-44.0x), suggesting the stock is undervalued relative to peers and its own history.
- Analyst Upside: Consensus price target of $630.90 implies 17.7% upside from the current price of $536.18, with a high target of $710 (32.4% upside). The consensus rating is 'Buy' with a mean score of 2.0.
Bearish
- Recent Price Drop: The stock fell 7.7% on August 6, 2026, to $536.18, and is down 6.9% over the past month, breaking below its 50-day moving average. This suggests near-term negative momentum and potential further downside.
- High Debt Levels: Debt-to-equity ratio of 5.22 is extremely high, and the current ratio of 0.80 indicates tight liquidity. While cash flow is strong, a downturn could strain the balance sheet.
- Fuel Margin Volatility: The business is heavily dependent on fuel margins, which are volatile and influenced by crude oil prices. Q1 2026 gross margin of 5.43% is an improvement, but sustainability is uncertain, and the forward PE of 17.88x implies expected earnings decline.
- Mixed Analyst Sentiment: Recent downgrades by Wells Fargo (to Equal Weight) and Raymond James (to Market Perform) indicate concerns about near-term headwinds, despite the overall 'Buy' consensus. The low target of $550 is only 2.6% above current price.
MUSA Technical Analysis
Murphy USA's stock has demonstrated a robust long-term uptrend, with a 1-year price change of +45.87%, significantly outperforming the S&P 500's +21.46% over the same period. The current price of $536.18 sits at 84.3% of its 52-week range (between $349.83 low and $636.05 high), indicating the stock is trading near the upper end of its range, reflecting strong momentum but also potential overextension. The 6-month price change of +41.89% further underscores the sustained bullish trend, though the stock has pulled back from its recent high of $636.05, suggesting a possible consolidation phase.
Beta
0.28
0.28x market volatility
Max Drawdown
-19.7%
Largest decline past year
52-Week Range
$350-$636
Price range past year
Annual Return
+46.4%
Cumulative gain past year
| Period | MUSA Return | S&P 500 |
|---|---|---|
| 1m | -4.1% | +2.9% |
| 3m | +1.3% | +5.0% |
| 6m | +39.7% | +13.9% |
| 1y | +46.4% | +20.4% |
| ytd | +40.4% | +13.8% |
Bobby - Your AI Investment Partner
Get real-time data, AI-driven personalized investment analysis to make smarter investment decisions
MUSA Fundamental Analysis
Murphy USA's revenue trajectory remains solid, with the latest quarter (Q1 2026) reporting revenue of $4.819 billion, a 6.49% year-over-year increase from $4.525 billion in Q1 2025. This growth is driven by both petroleum product sales ($3.697 billion) and merchandise sales ($1.049 billion), with the company's diversified revenue streams providing stability. However, the growth rate has decelerated from the 10.5% YoY growth seen in Q2 2025, indicating a normalization after a period of rapid expansion. The company's profitability is robust, with Q1 2026 net income of $136.3 million and a net margin of 2.83%, up from 1.18% in the year-ago quarter. Gross margin improved to 5.43% from 3.28%, reflecting better fuel margins and merchandise performance. Operating margin also expanded to 4.25% from 1.95%, showcasing operational efficiency. The balance sheet shows a high debt-to-equity ratio of 5.22, but the company generates strong cash flow, with operating cash flow of $320 million in Q1 2026 and free cash flow of $221.7 million. The current ratio of 0.80 indicates tight liquidity, but the company's ability to generate cash and its consistent share repurchases ($70.5 million in Q1) suggest financial flexibility.
Quarterly Revenue
$4.8B
2026-03
Revenue YoY Growth
+6.5%
YoY Comparison
Gross Margin
5.4%
Latest Quarter
Free Cash Flow
$555300000.0B
Last 12 Months
Revenue & Net Income Trends (2 Years)
Revenue Breakdown
Open an Account, get $2 TSLA now!
Valuation Analysis: Is MUSA Overvalued?
Given Murphy USA's positive net income, the price-to-earnings (PE) ratio is the primary valuation metric. The trailing PE is 16.55x, while the forward PE is 17.88x, indicating that the market expects earnings to slightly decline in the coming year. This is unusual for a growth company and may reflect concerns about fuel margin sustainability. Compared to the specialty retail industry average PE of 22.5x, Murphy USA trades at a 26% discount, suggesting the stock is undervalued relative to peers. However, the company's lower gross margin (5.0% vs. industry average of 30%) due to its fuel-heavy revenue mix justifies a lower multiple. Historically, Murphy USA's PE has ranged from 6.9x to 44.0x over the past five years, with the current 16.55x near the lower end of that range, indicating potential value. The PEG ratio of -45.0 is negative due to expected earnings decline, making it less meaningful, but the EV/EBITDA of 11.0x is reasonable for the sector.
PE
16.6x
Latest Quarter
vs. Historical
High-End
5-Year PE Range 7x~18x
vs. Industry Avg
N/A
Industry PE ~N/A*
EV/EBITDA
11.0x
Enterprise Value Multiple
Investment Risk Disclosure
Financial risks are significant due to Murphy USA's high leverage, with a debt-to-equity ratio of 5.22 and a current ratio of 0.80, indicating tight liquidity. The company's reliance on fuel sales (over 75% of revenue) exposes it to volatile crude oil prices, which can compress margins and cause earnings swings. While Q1 2026 showed strong profitability, the forward PE of 17.88x suggests the market expects earnings to decline, and any miss on fuel margin expectations could lead to a sharp re-rating. Additionally, the company's aggressive share repurchases ($70.5M in Q1) and dividend (payout ratio 8.8%) consume cash that might be needed for debt reduction in a downturn.