Murphy USA Q2 Earnings Beat Estimates on Strong Fuel Contribution

Results benefited from stronger fuel economics, higher total retail volumes and merchandise contribution growth. Same-store fuel volumes increased 0.5%, while total retail gallons advanced 3.9%.

MUSA's Fuel Economics Drive Strong Contribution

Total fuel contribution increased 32% year over year to $518.8 million. Moreover, the reported figure beat our estimate of $447.4 million. Retail fuel contribution climbed 25% to $448.9 million as retail fuel margins expanded to 35.1 cents per gallon from 29.2 cents in the prior-year quarter.  Both Retail fuel contribution and margins exceeded our estimates of $362 million and 29 cents per gallon, respectively.

All-in fuel contribution reached 40.6 cents per gallon, up from 32 cents a year earlier. Fuel supply, including RINs, contributed 5.5 cents per gallon compared with 2.8 cents. Management noted that tighter supply conditions supported stronger spot-to-rack spreads, while higher RIN prices aided results, though that timing benefit is not expected to persist through the second half.

Murphy USA's Merchandise Growth Remains Resilient

Total merchandise contribution rose 4% to $227.4 million, supported by higher merchandise sales and improved unit margins. Merchandise sales increased to $1.13 billion from $1.09 billion, while unit margin edged up to 20.1% from 20%.

Nicotine remained the main growth engine. Same-store nicotine sales and margins increased 2.4% and 4.6%, respectively. Cigarette sales and margins returned to growth, while nicotine-pouch unit volume more than doubled. Non-nicotine same-store sales declined 1.4%, although margins improved 0.2%.

MUSA Keeps Core Store Costs Under Control

Store and other operating expenses increased to $308.7 million from $275.2 million. Higher payment fees accounted for roughly two-thirds of the quarterly increase as higher retail fuel prices raised transaction costs. Employee-related expenses and new-store operating costs also contributed to the increase.

Still, store operating expenses excluding payment fees and rent rose only 1.1% on an average-per-store-month basis to $36,500. SG&A increased to $60.5 million from $50.9 million, primarily reflecting employee-related expenses and higher incentive accruals.

Murphy USA Refines Its Store Growth Plans

MUSA added six new-to-industry stores during the quarter and ended June with 1,806 locations. At quarter-end, 36 stores were under construction, including 32 new-to-industry sites and four raze-and-rebuild projects.

Management expects 2026 new-store additions to be closer to 45, the low end of its 45-55 range, absent tuck-in acquisitions. The company also reduced planned raze-and-rebuild activity to about 10 stores and is directing more resources toward new development, its land pipeline and stores scheduled to open in 2027.

MUSA Balances Growth, Spending and Shareholder Returns

Operating cash flow totaled $235 million in the quarter. Murphy USA ended June with $175.4 million in cash and cash equivalents and roughly $2.17 billion of long-term debt, with a debt-to-total capital of about 73.6%. Its revolving credit facility was undrawn at quarter-end.

This Zacks Rank #3 (Hold) company repurchased about 143,100 shares for $76.8 million at an average price of $536.60 and paid a quarterly dividend of 64 cents per share. Capital expenditures are now expected near the high end of the $475-$525 million range as spending shifts toward growth, land purchases and proactive maintenance. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Murphy USA Sees Higher 2026 Earnings Power

Management expects merchandise contribution to finish near the low end of the $890-$900 million range. Store operating expenses excluding payment fees, rent and SG&A are also tracking toward the low ends of their respective guided ranges, while the tax rate is expected near the high end of 23-25%.

First-half all-in fuel margins averaged 37.9 cents per gallon. Assuming a relatively conservative 35-cent margin in the second half, management expects full-year net income of about $636 million and adjusted EBITDA of approximately $1.25 billion. Management also indicated that sustained fuel-price declines could create upside to both volumes and margins by improving MUSA's ability to differentiate on price.

Important Energy Earnings at a Glance

While we have discussed MUSA’s second-quarter results in detail, let us take a look at three other key reports in the energy space.

Houston, TX-based oil and gas equipment and services provider Halliburton HAL posted second-quarter 2026 adjusted net income per share of 55 cents, marginally beating the Zacks Consensus Estimate of 54 cents. The outperformance was backed by year-over-year revenue growth. However, the bottom line was flat compared with the prior-year level.

As of June 30, 2026, Halliburton had approximately $2 billion in cash and cash equivalents and $7.1 billion in long-term debt, representing a debt-to-capitalization of 39%.

Fort Worth, TX-based oil and gas exploration and production company Range Resources Corporation RRC reported second-quarter 2026 adjusted earnings of 79 cents per share, up 19.7% from 66 cents a year ago. Range Resources’ bottom line topped the Zacks Consensus Estimate of 56 cents by 41.1%. Strong quarterly results are driven by higher production and improved price realization.

Range Resources’ net debt was $880.8 million at June 30, 2026, down 28% from $1.22 billion at year-end 2025. It repurchased $78 million of shares and paid $24 million in dividends during the quarter.

Houston, TX-based oil and gas storage and transportation company Kinder Morgan, Inc. KMI reported second-quarter 2026 adjusted earnings of 37 cents per share, beating the Zacks Consensus Estimate of 31 cents by 19.35%. Earnings increased 32.1% from 28 cents per share in the year-ago quarter. Strong quarterly results benefited from broad-based segment growth, led by higher natural gas transportation and gathering volumes. Natural gas transport volumes rose 7%, while gathering volumes increased 26%.

As of June 30, 2026, Kinder Morgan reported $89 million in cash and cash equivalents. Kinder Morgan’s net debt stood at $32.03 billion at quarter-end. The net debt-to-adjusted EBITDA ratio improved to 3.6X from 3.8X at the end of 2025.

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