Value
7.2/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 7.0 |
| P/S | 10.0 |
| EV/EBITDA | 5.4 |
| Fwd P/E | 7.0 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 18.1x
- ▸PEG: 0.10
- ▸Attractively valued
MUSA · Why this verdict
Why Murphy USA (MUSA) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.5/10
ConfidenceHIGH
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
Murphy USA generates an 80% return on equity with strong price momentum in a breakout setup, but single-supplier concentration through Core-Mark and a price already 16% above the analyst target leave the stock in unfavorable asymmetry territory for new buyers.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Murphy USA's return on equity of 80% is exceptional among specialty retail peers, reflecting a capital-light model that generates strong shareholder returns relative to the asset base. Quality breakdown | Return on equity remains above 50% over the next 12 months as the company sustains its current capital allocation discipline. | →Stable |
| CounterExtremely high return on equity is partly driven by elevated financial leverage (debt-to-equity of 4.1), meaning that debt repayment or margin compression could cause a rapid decline in this metric. | ||
Murphy USA is in a golden cross setup with the stock above all major moving averages, rising on-balance volume, and an RSI of 65, indicating broad-based buying pressure across multiple time frames. Momentum breakdown | The stock maintains above-200-day moving average positioning for at least 6 of the next 9 months as momentum sustains the breakout. | →Stable |
| CounterBreakout setups in specialty retail are fragile; a single negative earnings surprise or macro headwind to consumer discretionary spending could quickly reverse the technical picture. | ||
A single distributor (Core-Mark) supplies the majority of Murphy USA's merchandise, meaning a supply disruption, contract renegotiation, or distribution failure could materially impair store-level operations. Bear case | Murphy USA reduces its dependence on Core-Mark so that no single distributor accounts for more than 60% of merchandise supply within 18 months. | →Stable |
| CounterLong-term supply agreements with Core-Mark provide cost predictability and operational consistency, and the relationship may be deeply embedded enough that supply disruption risk is low in practice. | ||
At $586.83, Murphy USA trades 16% above the analyst price target, yielding a negative asymmetry ratio of -1.1 — meaning meaningful downside risk without a corresponding upside catalyst visible in the data. V9 | The stock price falls below $530 (declines more than 9% from current levels), restoring a favorable reward-to-risk profile. | →Stable |
| CounterAnalysts may be underestimating Murphy USA's earnings power if fuel margins and merchandise same-store sales outperform, potentially leading to target upgrades that close the gap. | ||
Murphy USA's return on equity of 80% is exceptional among specialty retail peers, reflecting a capital-light model that generates strong shareholder returns relative to the asset base.
→StableQuality breakdown
- Expectation
- Return on equity remains above 50% over the next 12 months as the company sustains its current capital allocation discipline.
CounterExtremely high return on equity is partly driven by elevated financial leverage (debt-to-equity of 4.1), meaning that debt repayment or margin compression could cause a rapid decline in this metric.
Murphy USA is in a golden cross setup with the stock above all major moving averages, rising on-balance volume, and an RSI of 65, indicating broad-based buying pressure across multiple time frames.
→StableMomentum breakdown
- Expectation
- The stock maintains above-200-day moving average positioning for at least 6 of the next 9 months as momentum sustains the breakout.
CounterBreakout setups in specialty retail are fragile; a single negative earnings surprise or macro headwind to consumer discretionary spending could quickly reverse the technical picture.
A single distributor (Core-Mark) supplies the majority of Murphy USA's merchandise, meaning a supply disruption, contract renegotiation, or distribution failure could materially impair store-level operations.
→StableBear case
- Expectation
- Murphy USA reduces its dependence on Core-Mark so that no single distributor accounts for more than 60% of merchandise supply within 18 months.
CounterLong-term supply agreements with Core-Mark provide cost predictability and operational consistency, and the relationship may be deeply embedded enough that supply disruption risk is low in practice.
At $586.83, Murphy USA trades 16% above the analyst price target, yielding a negative asymmetry ratio of -1.1 — meaning meaningful downside risk without a corresponding upside catalyst visible in the data.
→StableV9
- Expectation
- The stock price falls below $530 (declines more than 9% from current levels), restoring a favorable reward-to-risk profile.
CounterAnalysts may be underestimating Murphy USA's earnings power if fuel margins and merchandise same-store sales outperform, potentially leading to target upgrades that close the gap.
Per-dimension breakdown
Quality
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 10.0 |
| ROA | 7.6 |
| Gross margin | 0.0 |
| Op margin | 1.9 |
| Net margin | 1.6 |
| Current ratio | 3.3 |
| FCF quality | 5.4 |
| Moat | 5.4 |
| Piotroski F | 6.7 |
- ▸Excellent ROE: 80%
- ▸Earnings quality warning: 70% FCF/NI
- ▸No competitive moat
Growth
7.2/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 4.3 |
| EPS growth | 10.0 |
Momentum
2.1/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 1.0 |
| MA position | 4.0 |
| Volume | 0.0 |
- ▸Volume distribution (falling OBV)
- ▸Above 200-day MA
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 7.0 |
| Price target | 6.6 |
| erm sentiment | 5.0 |
- ▸Light analyst coverage (10.0) — signal dampened
Insider
3.4/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 3.0 |
| insider conviction | 2.0 |
| holder change | 5.1 |
- ▸Notable insider selling — $28,558,731 (0.291% of mkt cap)
Peer rank
5.4/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 5.8 |
| quality rank | 5.8 |
| growth rank | 5.0 |
- ▸Superior ROE vs peers
Technical
7.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 7.2 |
| support resistance | 8.3 |
| 52w position | 6.5 |
| gap | 6.0 |
Risk (lower is worse)
5.3/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 6.8 |
| days to cover | 7.3 |
| volatility | 1.1 |
| put call | 7.8 |
| implied vol | 5.4 |
| max pain risk | 3.0 |
| beta | 10.0 |
| debt equity | 0.9 |
- ▸Above max pain $470
- ▸Concentration risks: 1 HIGH (10-K Item 1A — sized via position_sizing, validated via buy_confidence)
Catalyst
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 9.5 |
| dividend safety | 5.2 |
- ▸Strong earnings: 3B/1M
- ▸Dividend: 46.0%
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (5)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:34d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:2.1<4.5
- ASYMMETRY:-0.4=NEGATIVE
Warning (1)
- 8K_CSUITE_CHANGE:5.02 (officer departure/appointment)
Reward-to-Risk
-0.39
Upside
-3.6%
Downside
9.1%
Sizing output
AVOID
SetupUNKNOWN — No clear chart pattern; technical signals are mixed
EdgeNO_EDGE — No clear edge identified
SuitabilityMODERATE — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 4.0 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Value at 7.2) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:2.1<4.5, ASYMMETRY:-0.4=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.39 — supplementary context, not the trigger for this path.
The strongest dimensions are Value at 7.2, Growth at 7.2, and Technical at 7.0; the weakest are Momentum at 2.1, Insider at 3.4, and Quality at 4.7. The V9 engine flagged 2 failed gates with 1 warning, producing an asymmetric reward-to-risk of -0.39 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Murphy USA's return on equity of 80% is exceptional among specialty retail peers, reflecting a capital-light model that generates strong shareholder returns relative to the asset base.
Trip ifReturn on equity falls below 40% for 2 consecutive quarters.
- P2Murphy USA is in a golden cross setup with the stock above all major moving averages, rising on-balance volume, and an RSI of 65, indicating broad-based buying pressure across multiple time frames.
Trip ifStock price falls below the 200-day moving average for more than 20 consecutive trading days.
- P3A single distributor (Core-Mark) supplies the majority of Murphy USA's merchandise, meaning a supply disruption, contract renegotiation, or distribution failure could materially impair store-level operations.
Trip ifCore-Mark accounts for more than 75% of merchandise supply, or a supply disruption causes same-store sales to decline more than 5%.
- P4At $586.83, Murphy USA trades 16% above the analyst price target, yielding a negative asymmetry ratio of -1.1 — meaning meaningful downside risk without a corresponding upside catalyst visible in the data.
Trip ifStock price rises above $650 (surpasses current levels by more than 10%) without a corresponding analyst target revision higher.