Value
8.3/10data confidence 83%| Component | Sub-score |
|---|---|
| P/E | 8.4 |
| P/S | 10.0 |
| EV/EBITDA | 6.3 |
| Fwd P/E | 6.7 |
| PEG | 10.0 |
- ▸Forward P/E: 18.9x
- ▸PEG: 0.05
- ▸Attractively valued
GLP · Why this verdict
Why Global Partners (GLP) 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 score5.8/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
The three quarters preceding the most recent report all missed estimates — by 8%, 39%, and 10% in order from newest to oldest — before a dramatic 460% beat in the latest period; the weight of recent history makes it premature to conclude the execution pattern has changed. Earnings | Earnings beats continue for at least 2 consecutive quarters following the most recent result, confirming that improved execution is durable rather than a one-off. | →Stable |
| CounterA 460% positive surprise in the most recent quarter is a powerful signal; commodity-driven midstream businesses can experience genuine step-changes in margin capture, and the latest data point may be the first of a new trend rather than an outlier. | ||
The business scores 3.7 on the quality dimension — below the 4.0 floor — with return on assets at 2.9 and operating margin near the bottom of its range, failing the minimum standard required for a position worth maintaining. Warnings | The composite quality score rises above 5.0, driven by sustained improvement in return on assets and operating margin over four consecutive quarters. | →Stable |
| CounterMidstream MLP quality metrics can be distorted by the capital-intensive nature of fuel distribution; a single quarter of significantly improved margins — as just demonstrated — can lift composite scores quickly if the operational gain proves durable. | ||
At a forward P/E of 18.2x and a PEG ratio of 0.04, the partnership offers an inexpensive entry relative to its near-term earnings stream, with roughly 11.7% headroom to the $50.96 resistance target. Valuation breakdown | The stock reaches $50.96 within 12 months while forward earnings estimates hold steady or improve, validating the current multiple as a durable discount rather than a temporary artifact. | →Stable |
| CounterLow PEG ratios in commodity businesses frequently reflect volatile or non-repeatable earnings rather than sustainable growth; the three preceding quarterly misses suggest that the earnings base underpinning this valuation is unreliable. | ||
Free cash flow covers only 64% of reported net income, and the high distribution yield has been flagged as potentially unsafe — raising the risk that payouts are being partially funded by non-cash earnings rather than organic cash generation. Quality breakdown | Free cash flow as a share of net income rises above 85% over the next four quarters, providing more secure coverage for the distribution without reliance on accounting-driven income components. | →Stable |
| CounterMidstream MLPs routinely run modest FCF-to-net-income gaps due to depreciation-heavy reporting and maintenance capex timing; if the near-term capex cycle eases, the ratio can recover without any operational deterioration. | ||
The three quarters preceding the most recent report all missed estimates — by 8%, 39%, and 10% in order from newest to oldest — before a dramatic 460% beat in the latest period; the weight of recent history makes it premature to conclude the execution pattern has changed.
→StableEarnings
- Expectation
- Earnings beats continue for at least 2 consecutive quarters following the most recent result, confirming that improved execution is durable rather than a one-off.
CounterA 460% positive surprise in the most recent quarter is a powerful signal; commodity-driven midstream businesses can experience genuine step-changes in margin capture, and the latest data point may be the first of a new trend rather than an outlier.
The business scores 3.7 on the quality dimension — below the 4.0 floor — with return on assets at 2.9 and operating margin near the bottom of its range, failing the minimum standard required for a position worth maintaining.
→StableWarnings
- Expectation
- The composite quality score rises above 5.0, driven by sustained improvement in return on assets and operating margin over four consecutive quarters.
CounterMidstream MLP quality metrics can be distorted by the capital-intensive nature of fuel distribution; a single quarter of significantly improved margins — as just demonstrated — can lift composite scores quickly if the operational gain proves durable.
At a forward P/E of 18.2x and a PEG ratio of 0.04, the partnership offers an inexpensive entry relative to its near-term earnings stream, with roughly 11.7% headroom to the $50.96 resistance target.
→StableValuation breakdown
- Expectation
- The stock reaches $50.96 within 12 months while forward earnings estimates hold steady or improve, validating the current multiple as a durable discount rather than a temporary artifact.
CounterLow PEG ratios in commodity businesses frequently reflect volatile or non-repeatable earnings rather than sustainable growth; the three preceding quarterly misses suggest that the earnings base underpinning this valuation is unreliable.
Free cash flow covers only 64% of reported net income, and the high distribution yield has been flagged as potentially unsafe — raising the risk that payouts are being partially funded by non-cash earnings rather than organic cash generation.
→StableQuality breakdown
- Expectation
- Free cash flow as a share of net income rises above 85% over the next four quarters, providing more secure coverage for the distribution without reliance on accounting-driven income components.
CounterMidstream MLPs routinely run modest FCF-to-net-income gaps due to depreciation-heavy reporting and maintenance capex timing; if the near-term capex cycle eases, the ratio can recover without any operational deterioration.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Global Partners LP screens attractively on forward earnings at 18.2x and offers roughly 11.7% headroom to its resistance target, but below-minimum business quality and a run of three consecutive earnings misses preceding the most recent result make the high distribution yield unreliable and the position unsuitable for holding.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
3.7/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 7.1 |
| ROA | 2.9 |
| Gross margin | 0.0 |
| Op margin | 0.8 |
| Net margin | 0.3 |
| Current ratio | 4.4 |
| FCF quality | 4.9 |
| Moat | 6.0 |
| Piotroski F | 6.7 |
- ▸Earnings quality warning: 64% FCF/NI
Growth
6.5/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 6.5 |
Momentum
6.4/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 10.0 |
| OBV | 10.0 |
| MA position | 6.0 |
| Volume | 0.4 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
4.8/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 4.5 |
| erm sentiment | 5.0 |
Insider
7.0/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 8.0 |
| insider conviction | 8.0 |
| holder change | 5.0 |
- ▸Notable insider buying — $6,040,684 (0.375% of mkt cap)
Peer rank
4.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.9 |
| quality rank | 4.1 |
| growth rank | 4.6 |
Technical
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.2 |
| support resistance | 3.9 |
| 52w position | 7.8 |
| gap | 6.0 |
Risk (lower is worse)
5.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.5 |
| days to cover | 8.3 |
| volatility | 2.1 |
| put call | 3.3 |
| implied vol | 3.2 |
| beta | 6.9 |
| debt equity | 1.8 |
- ▸High IV: 61%
Catalyst
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 3.5 |
- ▸Earnings concerns: 1B/3M
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (7)
- MOMENTUM:6.4>=5.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:31d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.6=NEGATIVE
Warning (0)
none
Reward-to-Risk
-1.59
Upside
-17.9%
Downside
11.3%
Sizing output
AVOID
SetupRange Bound — RSI 50 mid-range, Bollinger mid-band
EdgeInst Constrain — Small cap ($1.6B) below institutional reach
SuitabilityAggressive — MCap $1.6B<$5B
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 8.3 could not lift the engine output above the verdict floor. Failed gate signal: ASYMMETRY:-1.6=NEGATIVE.
The strongest dimensions are Value at 8.3, Insider at 7.0, and Growth at 6.5; the weakest are Quality at 3.7, Peer rank at 4.1, and Catalyst at 4.7. The V9 engine flagged 1 failed gate, producing an asymmetric reward-to-risk of -1.59 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Earnings Miss Streak Before Recent Beat
Trip ifEPS surprise exceeds 0% for 2 consecutive quarters following the most recent beat, confirming the execution improvement is durable.
- P2Quality Below Investment Minimum
Trip ifQuality score rises above 5.0 for 2 consecutive scoring periods, clearing the minimum threshold by a meaningful margin.
- P3Forward Valuation Attractive
Trip ifForward P/E expands above 28x or price closes below $40 for 2 consecutive weeks, eliminating the valuation discount.
- P4Distribution Yield Sustainability
Trip ifFree cash flow as a percentage of net income rises above 85% for 2 consecutive quarters, resolving the distribution coverage concern.