Opinion on SPB Superior Plus Corp.

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Hi Dan, could I have your opinion on SPB stock please. I own that stock for a while but for the last 18 months, it’s in a free fall. Bought at 11.50$… should I take the loss and invest in something else. Seemed a good buy a few years ago… not sure it’s going anywhere now.

Thanks

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Asked on August 14, 2024 3:24 pm
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Private answer

Unfortunately with Superior Plus being a company that primarily focuses on propane, it is at the mercy of propane prices.

If we look to propane prices since their peak in 2022, they've fallen by around 45% and Superior has fallen around 33%. As a result, earnings have really taken a hit from the company over this timeframe.

The "good buy" that was perceived in 2022 would likely be as a result of the stock price going up due to the price of propane soaring.

I will admit, I do not know very much about the wholesale propane market, and it's not really something I'd become fluent in in just a few days. So, to answer your question as to whether or not you should move on, I simply do not know.

There are actually very few outlooks and commentary on overall propane demand and pricing environment, so it makes it even more difficult for me to give you any sort of insight.

This stock has had a very long history of underperformance. The only real time it's done well is during the pandemic. I'd imagine many people go to it for its high yield. But at this point in time, the company is not generating enough earnings to even cover the dividend.

A rebound in propane prices would likely help the company, but as to whether or not that happens, I simply do not know. I'm sorry I couldn't be of any more help.

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Posted by Dan Kent
Answered on August 15, 2024 10:47 am