Propane stocks are on watch with restaurants boosting their outdoor seating capacities due to social distancing inside.
The Propane Trade: A survey from the National Restaurant Association showed 50% of full-service restaurants were taking action to extend their outdoor dining seasons with methods like patio heaters.
Paul Sankey, an independent oil analyst, refers to the demand as “the seemingly all-but COVID-proof propane market.”
Suburban Propane Partners: Serving over 1 million customers across 41 states, Suburban Propane Partners (NYSE:SPH) is one of the largest propane companies.
The company saw an increase of demand from retail customers in the third quarter, which helped offset weakness from the company’s commercial business. Third-quarter revenue was $206.9 million, a 3.4% year-over-year decline.
CEO Michael Stivala recently told Benzinga the company was seeing demand from restaurants, schools and other outdoor vendors that need propane to power their outdoor operations.
UGI Corporation: The AmeriGas brand, owned by UGI Corporation (NYSE:UGI) is the largest retail propane distributor. AmeriGas has 1.7 million customers throughout all 50 states and its 1,900 locations.
In the company’s third quarter, retail volume decreased by 3.2% year-over-year. Cylinder exchange volumes for propane tanks were up 30%. The AmeriGas segment saw revenue decline 5.8% year-over-year to $450.9 million.
UGI Corporation also owns UGI International, which serves customers in 17 countries. UGI International reported a 23.7% decline in year-over-year revenue of $371.5 million for the third quarter.
Superior Plus Corp: Shares of Superior Plus (OTC:SUUIF) also trade in Canada as symbol SPB. The company sells propane and specialty chemicals in Canada and the Northeast region of the U.S.
The company reported revenue of $450.8 million for the second quarter. Sales volume was lower, but adjusted EBITDA was 13% higher to $67.7 million. The company reported higher propane distribution in the U.S. in the quarter.
Superior Plus acquired Rymes Propane and oil to strengthen its propane business in the Northeast region of the U.S. with operations in New Hampshire, Maine, Massachusetts and Vermont.
Star Group LP: The third quarter saw revenue hit $232.2 million for Star Group LP (NYSE:SGU), which serves states in the North and East. This was an 18.1% decline year-over-year for the company. Home heating oil and propane volume increased 38.8% year-over-year to 51.2 million gallons in the quarter.