Company Overview
CrossAmerica Partners LP operates within the energy sector, specifically focusing on the oil and gas refining and marketing industry, where it engages in the wholesale distribution of motor fuels, the operation of convenience stores, and the ownership and leasing of real estate utilized for retail fuel distribution across the United States. The company functions through two primary segments, Wholesale and Retail, which together form the core of its operational footprint in the fuel supply chain. As of the latest reporting period, the entity holds a market capitalization of $821.43M and generates an annual revenue of $3.35B, though specific employee count data is not available in the provided records. These valuation and revenue figures indicate that CrossAmerica Partners LP maintains a mid-cap position in the energy market, reflecting a significant operational scale that supports its extensive network of fuel distribution and retail locations while navigating the volatility inherent in the refining and marketing landscape.
Financial Health
The financial performance of CrossAmerica Partners LP over the trailing twelve months shows a revenue of $3.35B, a net income of $39.11M, and an EBITDA of $143.58M, illustrating a substantial gap between top-line generation and bottom-line profitability. This disparity between revenue and net income reveals a cost structure where operating expenses, including fuel procurement costs, refining margins, and overhead, consume approximately 98.8% of the generated revenue before reaching the net income line. The company produced free cash flow of $49.82M, which provides a measure of financial flexibility for debt servicing and capital expenditures despite the thin profit margins. Profitability is further characterized by a gross margin of 12.0%, an operating margin of 3.4%, and a profit margin of 1.2%, indicating that the business operates on very thin margins typical of commodity-driven fuel distribution where pricing power is limited by market rates. On the balance sheet, the company holds cash of $3.94M against total debt of $818.72M, with a debt-to-equity ratio not available in the current data, suggesting a leveraged capital structure where debt obligations significantly exceed liquid cash reserves. Liquidity constraints are highlighted by a current ratio of 0.72, which indicates that current assets are insufficient to cover current liabilities without relying on new financing or asset sales. Return on assets stands at 4.6%, while return on equity is not available, suggesting that management effectiveness in generating returns on the total asset base is modest given the high leverage and low profit margins inherent in the refining and marketing business.
Valuation Assessment
Valuation metrics for CrossAmerica Partners LP include a trailing P/E ratio of 21.12 and a forward P/E of 30.34, implying that the market expects a significant contraction in earnings or a substantial increase in valuation multiples to justify the higher forward multiple. The price-to-book ratio is listed as -8.03, a negative figure that indicates the market values the company below its book value, often seen in distressed energy assets or those with significant intangible liabilities or restructuring needs. Alternative valuation perspectives include a price-to-sales ratio of 0.25 and an EV/EBITDA of 11.61, which suggest the stock is priced at a fraction of its sales but still commands a premium relative to earnings before interest, taxes, depreciation, and amortization when considering enterprise value. The stock trades within a 52-week range defined by a high of $25.73 and a low of $19.61; without the specific current share price in the facts, the valuation context relies on these bounds to show the recent trading volatility and the distance from the recent highs. The beta value is 0.36, which signifies that the stock's price volatility is substantially lower than that of the broader market, moving less than one-third as much as the market index during typical periods of fluctuation.
Growth & Income
Growth dynamics for CrossAmerica Partners LP are characterized by a revenue growth rate of -8.5% year-over-year and an earnings growth rate of -40.5% year-over-year, indicating that earnings are declining at a much faster pace than revenue, which suggests deteriorating refining margins or increased operational costs are outpacing volume declines. The company offers a dividend yield of 9.8% with a payout ratio of 205.9%, meaning the dividend payments exceed the reported net income, which raises questions about the sustainability of the payout given the current earnings trajectory. While the high dividend yield provides income to holders, the payout ratio exceeding 100% implies that the company is likely funding dividends through cash reserves, debt issuance, or non-cash accounting adjustments rather than organic earnings growth. The overall growth and income profile presents a complex picture of high current income yield offset by significant negative growth trends and a potentially unsustainable dividend structure relative to the reported net income of $39.11M.