LRT Capital Management, an investment management firm, released its October 2022 investor letter. A copy of the same can be downloaded here. The results in October were excellent, and its LRT Economic Moat strategy returned 7.38%. In addition, you can check the top 5 holdings of the fund to know its best picks in 2022.
LRT Capital discussed stocks like Murphy USA Inc. (NYSE:MUSA) in the investor letter. Headquartered in El Dorado, Arkansas, Murphy USA Inc. (NYSE:MUSA) is a motor fuel products retailer and convenience merchandise. On November 16, 2022, Murphy USA Inc. (NYSE:MUSA) stock closed at $291.99 per share. One-month return of Murphy USA Inc. (NYSE:MUSA) was 5.42%, and its shares gained 59.65% of their value over the last 52 weeks. Murphy USA Inc. (NYSE:MUSA) has a market capitalization of $6.597 billion.
LRT Capital made the following comment about Murphy USA Inc. (NYSE:MUSA) in its October investor letter:
“We currently hold an approximately 3.5% position in Murphy USA Inc. (NYSE:MUSA), and wanted to tell you more about this portfolio holding. This section was written by our intern Tin Nguyen, who is a junior at the University of Texas at Austin, with light edits by me.
Murphy USA (MUSA) is a fuel marketer, operating both gas stations and wholesale fuel distribution. The company also has a merchandise business segment where they sell typical convenience store items such as tobacco, energy drinks, and snacks. However, unlike many convenience stores, or CStores, the bulk of their gross profit comes from their retail fuel segment. In FY 2021, Murphy USA’s fuel contribution made up 62% of their gross profit while only 38% came from their merchandise contribution1 . By comparison, competitors such as CASY and Couche-Tard (Circle K) (pictured on the right) derive roughly 65% and 51% of their gross profit from convenience store sales and only 35 % and 47% from fuel, respectively.
Murphy USA became public in 2013 after Murphy Oil spun off its downstream energy business. The company primarily operates a kiosk model, or a C-store with low square footage dedicated to the store, many times only having 400 square feet of store area. By comparison, a typical Casy Store is 2,450 sq ft. for their larger store designs and 1,350 sq ft. for the rest of their smaller store designs4 . Historically, Murphy USA has had a partnership with Walmart where the majority of their Murphy USA branded stores are located in Walmart parking lots, with Murphy USA owning the underlying real estate. The company operates primarily in the Southeast, Southwest, and Midwest of the United States, and is one of the largest C-store chains by store count in the US…” (Click here to read the full text)
Roman Sigaev/Shutterstock.com
Murphy USA Inc. (NYSE:MUSA) is not on our list of 30 Most Popular Stocks Among Hedge Funds. As per our database, 27 hedge fund portfolios held Murphy USA Inc. (NYSE:MUSA) at the end of the third quarter which was 26 in the previous quarter.
We discussed Murphy USA Inc. (NYSE:MUSA) in another article and shared ClearBridge Investments’ views on the company. In addition, please check out our hedge fund investor letters Q3 2022 page for more investor letters from hedge funds and other leading investors.
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Disclosure: None. This article is originally published at Insider Monkey.