Suburban Propane Partners, L.P.

Suburban Propane Partners, L.P. (NYSE: SPH) specializes in propane, fuel oil, and refined fuels retail marketing and distribution, as well as natural gas and electricity marketing in deregulated markets. Propane, Fuel Oil, and Refined Fuels, as well as Natural Gas and Electricity, are among the company's segments.

Key Highlights

• Suburban Propane Partners, L.P. released profits for the second quarter ended March 26, 2022, on May 5, 2022, producing good operational results, progressing on the company's long-term strategic plans, and improving overall financial measures.
• On April 27, 2022, Suburban Propane Partners, L.P. announced the commercial debut of Propane+rDME. This innovative new product combines the clean, flexible, and widely accessible propane with the renewable, low-carbon benefits of Oberon Fuels' renewable dimethyl ether (rDME) to help reduce emissions and fulfill tough carbon reduction targets.
• The Board of Supervisors of Suburban Propane Partners, L.P. issued a quarterly dividend of USD 0.325 per share for the three months ending March 26, 2022, on April 21, 2022. corresponding to USD 1.30 per share at an annualized rate. Common Stockholders of record on May 02, 2022, will receive the distribution on May 10, 2022.
• Suburban Propane Partners, L.P. stated on March 10, 2022, that it had paid USD 30.0 million for a 25% ownership investment in Independence Hydrogen, Inc., a veteran-owned and operated supplier of gaseous hydrogen solutions. As part of its long-term strategic aim of building up a renewable energy platform, the Partnership recently announced the formation of a new subsidiary, Suburban Renewable Energy, LLC.
• Despite difficult operating conditions caused by erratic climate patterns, record-high commodity prices, and inflationary factors affecting expenditures, the company was able to increase its customer base and better manage margins and expenditures to achieve a net income of USD 175.1 million, or USD 2.77 per share in the second quarter of fiscal 2022, up from USD 127.2 million, or USD 2.03 per share, in the second quarter of fiscal 2021.
• In the second quarter of fiscal 2022, the total gross margin was USD 349.1 million, up from USD 305.7 million the year before. The mark-to-market adjustment for derivative instruments employed in risk management operations contributed USD 33.0 million to the gross margin in the second quarter of fiscal 2022, compared to USD 1.6 million the year before.

One-year technical Price Chart (At 6:50 AM PDT, as of 6 May 2022). Source: REFINITIV, Analysis by Kalkine Group

Conclusion

SPH's stock price is up 12.48% in the past six months even in a bearish market and is currently leaning towards the upper end of its 52-week range of USD 13.83 to USD 17.75.

Given the stock's considerable strong price movement over the last year, financial results, and technical analysis, we propose a "Watch" rating on the stock at its current price of USD 17.03, as of 6^th May 2022 at 6:50 AM PDT.

Technical Analysis Summary

* Current price at 6:50 AM PDT, as of May 6, 2022.

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Technical Indicators Defined: -

Support: A level where-in the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest.

Resistance: A level where-in the stock prices tend to find resistance when they are rising, and the uptrend may take a pause due to profit booking or selling interest.

Stop-loss: It is a level to protect further losses in case of unfavorable movement in the stock prices.

Note 1: The reference data in this report has been partly sourced from REFINITIV.  

Note 2: Investment decisions should be made depending on the investors' appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting the stock if the Target Price mentioned as per the valuation has been achieved and subject to the factors discussed above. 

Note 3: The report publishing date is as per the Pacific Time Zone.

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