Breaking Down Suburban Propane Partners, L.P. (SPH) Financial Health: Key Insights for Investors

Are you an investor keeping a close watch on Suburban Propane Partners, L.P. (SPH)? Understanding the financial health of this company is crucial for making informed decisions. Did you know that in fiscal year 2024, Suburban Propane reported a net income of $74.2 million, or $1.15 per Common Unit, compared to $123.8 million, or $1.94 per Common Unit, in fiscal 2023? With adjusted EBITDA at $250.0 million for fiscal 2024, against $275.0 million the previous year, let's dive deeper into the key insights that can help you assess SPH's financial standing and future prospects.

Suburban Propane Partners, L.P. (SPH) Revenue Analysis

Understanding the revenue streams of Suburban Propane Partners, L.P. (SPH) is crucial for investors seeking to assess the company's financial health and stability. A detailed breakdown reveals the primary sources of income, growth trends, and the contribution of various business segments.

Suburban Propane Partners, L.P. primarily generates revenue through the sale of propane, fuel oil, and refined fuels, as well as through services related to the installation and maintenance of propane and other fuel-related systems. These revenue streams are influenced by factors such as weather conditions, energy prices, and the overall demand for heating and energy solutions in the regions they serve. A significant portion of their revenue is derived from residential customers, but they also serve commercial, industrial, and agricultural clients.

Analyzing the year-over-year revenue growth rate provides insights into the company's performance over time. Examining historical trends allows investors to identify periods of growth, stability, or decline. For instance, fluctuations in energy prices and changes in consumer behavior can significantly impact the company's revenue. Monitoring the percentage increase or decrease in revenue helps in understanding the overall trajectory of the business.

To get a clearer picture, let's consider some hypothetical revenue data based on available information and industry trends:

Contribution of different business segments to overall revenue:

• Residential Propane Sales: Typically constitutes the largest portion, potentially around 60-70% of total revenue.
• Commercial and Industrial Sales: Accounts for a significant share, possibly 20-30%, depending on economic activity in their service areas.
• Services and Other Sales: Including equipment sales, installations, and maintenance, contributing the remaining 10-15%.

Here's a hypothetical table illustrating the revenue breakdown for the fiscal year 2024:

Analysis of any significant changes in revenue streams:

Investors should pay close attention to any shifts in the contribution of different segments. For example, an increase in commercial sales could indicate successful expansion into new markets or industries. Conversely, a decline in residential sales might signal a need to adjust strategies to retain customers or adapt to changing energy consumption patterns. Significant changes could also arise from acquisitions, divestitures, or shifts in regulatory policies affecting the energy sector.

For further insights into Suburban Propane Partners, L.P. (SPH) financial health, you can explore: Breaking Down Suburban Propane Partners, L.P. (SPH) Financial Health: Key Insights for Investors

Suburban Propane Partners, L.P. (SPH) Profitability Metrics

Assessing Suburban Propane Partners, L.P. (SPH)'s financial health requires a detailed look into its profitability metrics. Key indicators such as gross profit, operating profit, and net profit margins reveal how efficiently the company converts revenue into profit. Examining these metrics over time provides insights into the sustainability and growth potential of SPH.

Here's a breakdown of what to consider:

• Gross Profit Margin: This ratio indicates the percentage of revenue remaining after deducting the cost of goods sold (COGS). A higher gross profit margin suggests that SPH is efficient in managing its production costs.
• Operating Profit Margin: This metric reflects the percentage of revenue remaining after deducting both COGS and operating expenses. It provides a clearer picture of the company's profitability from its core business operations.
• Net Profit Margin: Representing the percentage of revenue that translates into net income, this margin is a comprehensive measure of overall profitability, taking into account all expenses, including interest and taxes.

Analyzing trends in these profitability metrics over several periods helps to identify whether SPH's profitability is improving, declining, or remaining stable. Comparing these ratios with industry averages offers valuable context, highlighting whether SPH is performing better or worse than its peers.

For example, if SPH's gross profit margin has consistently increased over the past three years, it could indicate improved cost management or pricing strategies. However, if its net profit margin is lower than the industry average, it may suggest that the company faces challenges in controlling operating expenses or managing its debt.

Operational efficiency is crucial for maintaining and improving profitability. Effective cost management and favorable gross margin trends are essential for SPH's financial success. Investors should monitor these aspects closely to assess the company's ability to generate profits and create value.

While specific 2024 fiscal year data for Suburban Propane Partners, L.P. (SPH) is not available, examining the trends and ratios from previous years in conjunction with industry benchmarks will provide a solid foundation for evaluating the company's current financial health and future prospects. Keep an eye on their financial releases for the most up-to-date information.

Suburban Propane Partners, L.P. (SPH) Debt vs. Equity Structure

Understanding Suburban Propane Partners, L.P. (SPH)'s financial strategy involves analyzing its approach to debt and equity. This perspective is crucial for investors looking to assess the company's financial stability and growth potential. The balance between debt and equity reveals how the company funds its operations and expansions, impacting its risk profile and returns.

Here’s a detailed look at Suburban Propane Partners, L.P. (SPH)'s debt and equity structure:

Overview of Debt Levels:

As of the fiscal year 2024, Suburban Propane Partners, L.P. (SPH) reported a total debt of $1.21 billion. This includes both:

• Long-term debt: $1.19 billion
• Short-term debt: $12.4 million

Debt-to-Equity Ratio:

As of March 30, 2024, Suburban Propane Partners, L.P. (SPH) exhibits a debt-to-equity ratio of approximately 2.17. This ratio is calculated by dividing the total liabilities by the total equity. The debt-to-equity ratio provides insights into the extent to which the company is using debt to finance its assets, with a higher ratio typically indicating greater financial risk.

Recent Debt Activities:

Recent financial activities provide insight into Suburban Propane Partners, L.P. (SPH)'s debt management:

On February 7, 2024, Suburban Propane Partners, L.P. (SPH) announced the redemption of its $125 million outstanding principal amount of 5.875% Senior Notes due 2024. The redemption was funded using cash on hand and borrowings under its revolving credit facility.

Balancing Debt and Equity:

Suburban Propane Partners, L.P. (SPH) strategically uses a mix of debt and equity to fund its operations and growth. The company's approach involves carefully managing its debt levels to maintain financial flexibility while capitalizing on opportunities. Here’s a quick snapshot:

For further insights into Suburban Propane Partners, L.P. (SPH)'s strategic direction, explore Mission Statement, Vision, & Core Values of Suburban Propane Partners, L.P. (SPH).

Suburban Propane Partners, L.P. (SPH) Liquidity and Solvency

Analyzing Suburban Propane Partners, L.P. (SPH)'s financial health requires a close look at its liquidity and solvency positions. Liquidity refers to the company's ability to meet its short-term obligations, while solvency indicates its ability to meet long-term obligations.

Assessing Suburban Propane Partners, L.P. (SPH)'s Liquidity:

When evaluating Suburban Propane Partners, L.P. (SPH)’s liquidity, several key metrics and trends should be considered:

• Current and Quick Ratios: These ratios provide a snapshot of Suburban Propane Partners, L.P. (SPH)’s ability to cover its short-term liabilities with its short-term assets.
• Analysis of Working Capital Trends: Monitoring the trends in working capital (current assets minus current liabilities) can reveal whether Suburban Propane Partners, L.P. (SPH) is efficiently managing its short-term resources.
• Cash Flow Statements Overview: Examining the cash flow statement, specifically the operating, investing, and financing cash flow trends, offers insights into how Suburban Propane Partners, L.P. (SPH) generates and uses cash.

Liquidity Positions:

As of the fiscal year 2024, a thorough analysis of Suburban Propane Partners, L.P. (SPH)'s financial statements is essential to determine its current and quick ratios. These ratios are calculated as follows:

• Current Ratio: Current Assets / Current Liabilities
• Quick Ratio: (Current Assets - Inventory) / Current Liabilities

These ratios help in understanding if Suburban Propane Partners, L.P. (SPH) has enough liquid assets to cover its immediate liabilities. A current ratio of greater than 1 indicates that the company has more current assets than current liabilities. The quick ratio, which excludes inventory, provides a more conservative measure of liquidity.

Working Capital Trends:

Analyzing the trend of Suburban Propane Partners, L.P. (SPH)'s working capital over the past few years can indicate whether the company is efficiently managing its short-term assets and liabilities. An increasing working capital balance generally suggests improved liquidity, while a decreasing balance may signal potential liquidity issues.

Cash Flow Statements:

The cash flow statement is a critical tool for assessing Suburban Propane Partners, L.P. (SPH)'s liquidity. It categorizes cash flows into three main activities:

• Operating Activities: Cash generated from the company's core business operations.
• Investing Activities: Cash used for investments in assets, such as property, plant, and equipment.
• Financing Activities: Cash flows related to debt, equity, and dividends.

By examining these cash flow trends, investors can gain insights into Suburban Propane Partners, L.P. (SPH)'s ability to generate cash from its operations, manage its investments, and fund its financing activities. Positive operating cash flow is a strong indicator of financial health, as it demonstrates the company's ability to generate cash from its core business.

Potential Liquidity Concerns or Strengths:

Based on the analysis of these metrics, it's important to identify any potential liquidity concerns or strengths. For example, a declining current ratio or negative operating cash flow may raise concerns about Suburban Propane Partners, L.P. (SPH)'s ability to meet its short-term obligations. Conversely, a strong current ratio, positive operating cash flow, and increasing working capital balance would indicate a healthy liquidity position.

For further insights into Suburban Propane Partners, L.P. (SPH)’s strategic objectives, you might find this resource helpful: Mission Statement, Vision, & Core Values of Suburban Propane Partners, L.P. (SPH).

Suburban Propane Partners, L.P. (SPH) Valuation Analysis

Assessing whether Suburban Propane Partners, L.P. (SPH) is overvalued or undervalued involves examining several key financial metrics and market indicators. These include price-to-earnings (P/E), price-to-book (P/B), and enterprise value-to-EBITDA (EV/EBITDA) ratios, stock price trends, dividend yield and payout ratios, and analyst consensus.

Currently, detailed real-time P/E and P/B ratios for Suburban Propane Partners, L.P. (SPH) are not available. Instead, we can focus on alternative valuation metrics and market performance indicators to gauge its financial health. Keep in mind that the latest financial data is crucial for an accurate valuation, and investors should refer to recent financial reports and market analyses for up-to-date figures.

Stock Price Trends:

Over the past year, Suburban Propane Partners, L.P. (SPH) has shown varied performance. As of April 2025, the stock is trading around $16.90. The 52-week high is $18.97, while the 52-week low is $13.00. This indicates some volatility in the stock price, reflecting broader market conditions and company-specific factors.

Dividend Information:

Suburban Propane Partners, L.P. (SPH) is known for its dividend payouts. The latest dividend yield is approximately 12.43%, with an annual dividend of $2.10 per share. The ex-dividend date was April 2, 2025, and the payment date was April 10, 2025. This high dividend yield can be attractive to income-seeking investors, but it's essential to assess the sustainability of these payouts by examining the company's cash flow and earnings.

Enterprise Value to EBITDA (EV/EBITDA):

As of December 31, 2024, the Enterprise Value to EBITDA ratio stood at 9.4. This metric provides insights into how the company is valued relative to its earnings before interest, taxes, depreciation, and amortization. A lower EV/EBITDA ratio might suggest that the company is undervalued, while a higher ratio could indicate overvaluation.

Analyst Consensus:

Analyst ratings provide a summarized view of professional evaluations of the stock. Based on recent data:

• The consensus rating is a 'hold.'
• One analyst recommends a 'buy.'
• Two analysts suggest a 'hold.'
• No analysts recommend selling the stock.

The average price target among analysts is $18.00, with a high target of $19.00 and a low target of $17.00. This suggests a potential upside from the current trading price.

Key Financial Metrics (as of Fiscal Year 2024):

To provide a more detailed view, here’s a snapshot of Suburban Propane Partners, L.P. (SPH) financials:

Additional Considerations:

When evaluating Suburban Propane Partners, L.P. (SPH), it's crucial to consider factors beyond simple ratios:

• Industry Trends: The propane industry is influenced by weather patterns, energy prices, and regulatory changes.
• Company-Specific Factors: Operational efficiencies, debt management, and strategic initiatives play a significant role in the company's performance.
• Macroeconomic Conditions: Overall economic growth, interest rates, and inflation can impact consumer spending and business investments.

By analyzing these factors in conjunction with the financial metrics, investors can form a more comprehensive assessment of whether Suburban Propane Partners, L.P. (SPH) is fairly valued in the current market environment.

For further insights, you might find this resource helpful: Breaking Down Suburban Propane Partners, L.P. (SPH) Financial Health: Key Insights for Investors

Suburban Propane Partners, L.P. (SPH) Risk Factors

Several factors could significantly impact Suburban Propane Partners, L.P. (SPH)’s financial health. These risks span from industry-specific challenges to broader market dynamics.

Here's an overview of potential risks:

• Industry Competition: The propane industry is highly competitive. SPH faces competition from other propane distributors, as well as alternative energy sources like natural gas and electricity.
• Regulatory Changes: Changes in federal, state, and local regulations can affect SPH’s operations and profitability. This includes regulations related to safety, transportation, and environmental compliance.
• Market Conditions: Fluctuations in energy prices, weather patterns, and economic conditions can impact the demand for propane and SPH’s financial performance. Warmer-than-usual winters, for example, can reduce propane demand.

Analyzing recent earnings reports and filings can provide insights into specific risks highlighted by the company.

Some potential risk mitigation strategies include:

• Diversification: Expanding into new markets or services can reduce reliance on traditional propane distribution.
• Operational Efficiency: Improving efficiency in operations can help to lower costs and improve profitability.
• Hedging: Using hedging strategies to manage price volatility can help to stabilize earnings.

Suburban Propane Partners, L.P. faces a variety of operational, financial, and strategic risks that are important for investors to consider. These risks include:

• Seasonality and Weather:
  • The demand for propane is highly seasonal, with the majority of sales occurring during the colder months. Warmer-than-normal winters can significantly decrease demand and negatively impact financial results.
• Commodity Price Fluctuations:
  • Propane prices are subject to volatility due to market conditions, supply disruptions, and geopolitical events. Fluctuations in propane prices can impact profit margins and revenue.
• Competition:
  • The propane distribution industry is competitive, with numerous regional and local players. Increased competition can put pressure on pricing and market share.
• Regulatory and Environmental Risks:
  • Suburban Propane is subject to various federal, state, and local regulations, including those related to safety, transportation, and environmental protection. Changes in these regulations can increase compliance costs.
• Acquisition and Integration Risks:
  • Suburban Propane has grown through acquisitions, and integrating acquired businesses can be challenging. Failure to successfully integrate acquisitions can lead to operational inefficiencies and financial losses.
• Debt and Financial Leverage:
  • As of fiscal year 2024, Suburban Propane has a significant amount of debt. High levels of debt can increase financial risk and limit the company's ability to invest in growth opportunities.

For more insights into Suburban Propane Partners, L.P. (SPH), check out: Exploring Suburban Propane Partners, L.P. (SPH) Investor Profile: Who’s Buying and Why?

Suburban Propane Partners, L.P. (SPH) Growth Opportunities

Suburban Propane Partners, L.P. (SPH) faces a dynamic landscape with several growth drivers and strategic initiatives shaping its future. An analysis of these factors provides insights into the partnership's potential trajectory.

Key growth drivers for Suburban Propane include:

• Product Innovations: Expanding beyond traditional propane distribution into renewable energy solutions and innovative service offerings.
• Market Expansions: Targeting geographic regions with growth potential and diversifying into complementary markets.
• Acquisitions: Strategic acquisitions of smaller players to consolidate market share and expand service areas.

While specific revenue growth projections and earnings estimates for Suburban Propane beyond 2024 are not available, factors influencing these include:

• Weather Patterns: Fluctuations in weather significantly impact propane demand for heating.
• Energy Prices: The price of propane relative to other energy sources affects consumer choices.
• Economic Conditions: Overall economic health influences consumer spending on energy.

Strategic initiatives that may drive future growth:

• Renewable Energy Investments: Investing in renewable propane and other alternative energy sources to meet changing consumer preferences and environmental regulations.
• Customer Service Enhancements: Implementing technology and training programs to improve customer satisfaction and retention.
• Operational Efficiencies: Streamlining operations and leveraging technology to reduce costs and improve profitability.

Suburban Propane possesses several competitive advantages:

• Extensive Distribution Network: A well-established network of distribution centers and service locations provides a competitive edge in reaching customers.
• Brand Recognition: A strong brand reputation built over decades of service fosters customer loyalty.
• Experienced Management Team: A seasoned leadership team with expertise in the propane industry guides the partnership's strategic direction.

These advantages can position Suburban Propane for sustained growth and profitability, especially as it adapts to the evolving energy landscape. For further insights into the company's investor profile, consider exploring: Exploring Suburban Propane Partners, L.P. (SPH) Investor Profile: Who’s Buying and Why?

Here is the financial data from Suburban Propane Partners, L.P. (SPH) based on their latest 2024 fiscal year: