Murphy USA NYSE: MUSA executives used the company’s first-quarter 2026 earnings Q&A to emphasize strong early-year performance while cautioning that fuel markets remain unusually volatile, making it difficult to forecast the balance of the year with confidence.
Christian Pikul, Vice President of Investor Relations and FP&A, opened the call by noting the company is rebranding what it previously referred to as “PS&W plus RINs” and will now simply call the segment fuel supply. He also clarified that management’s comment about April volumes being “flat” versus the prior year was measured on an average per store month basis, not total volume.
Guidance unchanged despite strong Q1
Asked by RBC Capital Markets’ Irene Nattel what would need to happen for Murphy USA to not exceed its 2026 guidance, President and CEO Mindy West said it would “take a lot” given the company’s first-quarter outperformance. However, she said the company did not update its 2026 guidance and typically does not do so after the first quarter.
West said the original guidance “was built around very low volatility, low price environment,” but the market has shifted. “This is unprecedented volatility and geopolitical risk,” she said, adding that she would not “know what fuel margin to put into the model to give you an accurate forecast.” Instead, West said the company will remain nimble and “react to market conditions on that day.”
Fuel supply volatility and retail margin outlook
West told analysts that fuel supply results were high in the first quarter and described how inventory valuation can swing results depending on fuel price direction. She said the core fuel supply business generated about $0.025 excluding the impact of higher prices, and that continued price increases would typically drive positive inventory valuations, while price declines would have the opposite effect—though declining prices can also support expanding retail margins and potentially volumes.
Goldman Sachs analyst Bonnie Herzog asked about the contribution from RINs (Renewable Identification Numbers) and how to think about fuel supply in the second quarter. West said Murphy USA evaluates it “on a blended basis” and described RINs as largely a pass-through, since RIN value is “factored into the acquisition cost when we purchase the product.” She said sustained movement in one direction can create “a slight impact over a short period,” but over time those impacts “cancel out.”
On near-term conditions, West referenced April expectations outlined in the company’s prepared remarks, stating Murphy USA had guided to $0.35–$0.40 per gallon. She added that, with April books not yet closed, management was “comfortable saying” retail margins were expected “somewhere in the low 30s,” implying fuel supply would trend above normal due to continued volatility.
Jefferies analyst Corey Tarlowe later asked why early April fuel supply trends appeared lower than the first quarter. West attributed the change to price variability: price movements were “magnified in the month of March,” while April’s increases had been less dramatic.
Consumer behavior, volumes, and loyalty signals
Herzog also asked whether higher pump prices were changing behavior, particularly among lower-income consumers, and whether Murphy USA was seeing trade-down that could support share gains. West said that by the time customers are shopping at Murphy USA “for our everyday low prices, much of that traditional trade down has already occurred,” and she said the company sees relatively little pressure in non-discretionary categories, even with higher prices.
Within the store, West said the company does observe customers making different decisions in discretionary categories “like salty snacks or really even lottery,” where there are more venues to participate. She also pointed to in-store performance metrics discussed in prepared remarks, saying non-nicotine sales were up 2% with margins up over 4% at Murphy stores.
West said higher fuel prices are bringing in “new customers” and “lapsed customers returning,” reinforcing Murphy USA’s positioning as a low-price retailer. KeyBanc’s Bradley Thomas asked about retention of new customers acquired during high-price periods. West highlighted the company’s loyalty initiatives—Murphy Drive Rewards and QuickChek Rewards—saying March active members were up 8.5% year-over-year and total transactions were up around 12%.
Wells Fargo’s Edward Kelly asked why fuel gallon trends weren’t stronger given rising prices. West said volume uplift “takes time,” and that pronounced shifts typically occur once prices remain elevated—particularly above $4—for a sustained period. She said April volumes were “holding up well,” roughly flat year-over-year on an average-per-store-month basis. She also noted that only about a quarter of the chain was at or above $4 at the time of the call.
West cited a leading indicator from loyalty activity: Murphy Drive Rewards saw about 600,000 more signups, which she said was the highest monthly total since 2022 and a signal that customers are seeking value.
West also discussed geographic differences affecting volumes and margins, citing continued pressure in Colorado amid broad market growth and competitive activity in Florida. She contrasted those markets with Texas, which she described as more mature with less volume and margin pressure. Weather also impacted the quarter, with West estimating a headwind of roughly 2% (and possibly more) due to closures and duration; she said volumes would have been up rather than down without those disruptions.
Operations, capital allocation, and QuickChek focus
On operating expenses, Kelly noted store OpEx was well controlled in the first quarter. West said the roughly flat increase reflected self-help actions implemented last year, including continued refinement of the store labor model—staffing adequately during busy times but avoiding overstaffing during slower periods. She also cited progress on shrink and a shift in maintenance prioritization and batching, offering an example of delaying canopy light repairs until multiple bulbs are out to reduce site-visit costs.
West said that as new stores enter the network, the company expects roughly half of OpEx growth to reflect those additions, and she expects results to move back toward the company’s 2026 guidance range in the second half as new stores come online.
JPMorgan’s Thomas Palmer asked about capital allocation in light of stronger earnings. West said the first priority remains growth capital expenditures, with the company committed to building 45 to 55 sites during the year. She said Murphy USA also plans “ratable share repurchases,” may proactively procure equipment to support new-to-industry stores (such as tanks), and could consider deleveraging, though she said it is not a high priority given the company’s low leverage.
Raymond James’ Bobby Griffin asked about QuickChek, as company-wide same-store results appeared pressured by the Northeast. West said the region faces more QSR-related competitive pressure than Murphy USA’s core markets. She said the company is focusing on core food items such as “coffee, breakfast, sandwiches,” simplifying menus, rationalizing assortment, and improving margins. West also said Murphy USA is working to develop a “sales-first mentality” at QuickChek, supported by leadership changes, though she noted it was too early for proof points.
In closing remarks, West said management believes the first-quarter results were not solely the byproduct of volatility, citing efforts to optimize the volume-margin relationship and to strengthen merchandise and store operations. While acknowledging volatility “does work in our favor,” she said the company “can’t rely on volatility,” and reiterated a focus on execution, improving the existing base business, and continuing high-quality new-store growth.
About Murphy USA NYSE: MUSA
Murphy USA is a leading downstream marketer of gasoline, diesel and convenience store products in the United States. Headquartered in El Dorado, Arkansas, the company was originally established as part of Murphy Oil Corporation and was spun off as an independent public entity in 2013. Since its separation, Murphy USA has focused on retail fueling services and convenience offerings designed to deliver value and convenience to consumers.
The company's primary operations center on two retail formats.
Recommended Stories
This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.
Before you consider Murphy USA, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Murphy USA wasn't on the list.
While Murphy USA currently has a Moderate Buy rating among analysts, top-rated analysts believe these five stocks are better buys.
View The Five Stocks Here
MarketBeat just released its list of the 7 hottest IPOs expected to hit Wall Street in 2026. See which companies are preparing to go public and why investors are watching closely.
Get This Free Report
