Murphy USA Inc. (MUSA): BCG Matrix [Dec-2025 Updated]

You're looking at Murphy USA Inc.'s business segments right now, and honestly, the BCG matrix paints a clear picture: it's a classic convenience play where the fuel business is printing serious cash to fuel big bets. The core fuel operation delivered $393.0 million in contribution dollars in Q2 2025, keeping the lights on, while merchandise-especially non-nicotine items-is shining as a Star, growing 11.3% in Q3 2025. But this isn't all smooth sailing; we've got legacy stores acting like Dogs with 2.6% volume drops, balanced by aggressive Question Mark spending, like the up to $500 million earmarked for raze-and-rebuilds this year. Dive in to see exactly where Murphy USA is pouring its capital for growth versus where it's just milking the reliable, albeit shrinking, older assets.

Background of Murphy USA Inc. (MUSA)

Murphy USA Inc. (NYSE: MUSA) is a major marketer of retail motor fuel products and convenience merchandise across the United States. As of the end of the third quarter of 2025, Murphy USA Inc. operated a network of 1,772 stores across 27 states.

The store portfolio is segmented geographically, with the majority of locations branded as Murphy, numbering 1,620 stores, while the remaining 152 stores operate under the QuickChek banner. These locations are mainly concentrated in the Southeast and Midwest regions, with the QuickChek stores situated in New Jersey and New York, representing the Northeast presence.

For the three months ended September 30, 2025, Murphy USA Inc. reported Total Operating Revenues of $5,110.0 million, which was a 2.4% decrease compared to the $5.238 billion in revenue from the same quarter in 2024. Net income for the third quarter of 2025 was $129.9 million, marking a 13% decline from the third quarter of 2024. The reported diluted earnings per share for the third quarter was $6.76.

Operationally, the company saw retail fuel volumes increase by 1.2% in the third quarter of 2025 compared to the third quarter of 2024, even as retail fuel margin dollars decreased by 10.4% in the same period. Despite this, the third quarter all-in margins were reported to be above 30 cents per gallon.

Murphy USA Inc. continues to execute on its expansion strategy, with 39 new stores and 2 raze and rebuild projects under construction as of late October 2025. The company has reaffirmed its capital expenditure guidance for the full year 2025 to be in the range of $450 million to $500 million. In a significant capital allocation move, the company also announced a $2 billion share buyback plan.

The company announced a leadership transition in October 2025, naming Chief Operating Officer Mindy West as president, effective January 1, 2026, to replace the outgoing CEO. This follows a second quarter in 2025 where the company delivered stronger financial results, posting net income of $145.6 million and achieving all-in fuel margins of 32 cents per gallon.

Murphy USA Inc. (MUSA) - BCG Matrix: Stars

You're analyzing the portfolio, and the merchandise segment for Murphy USA Inc. clearly shows characteristics of a Star. These are the areas where the company has a strong position in a market that's still expanding, demanding significant investment to maintain that lead.

The focus here is heavily on the center-of-store categories, which are key to driving overall contribution dollars. Specifically, you see continued share gains in categories like packaged beverages and candy, which are foundational to the non-nicotine offering. This is a high-growth area where market leadership is being actively pursued.

The financial results from the third quarter of 2025 really highlight this momentum. Merchandise contribution dollars grew by 11.3% year-over-year, reaching $241.2 million for Q3 2025. That growth outpaced the non-nicotine segment as a whole, which saw a smaller increase of 2.8% in contribution dollars for the same period. This suggests that the targeted center-of-store categories are performing exceptionally well within the broader non-nicotine mix.

Here's a quick look at the merchandise contribution performance for the first three quarters of 2025:

The integration of the QuickChek acquisition is also feeding into this Star quadrant, particularly through its focus on fresh food, which represents a higher-margin opportunity. As of the second quarter 2025 earnings call, the average per store month food and beverage sales at QuickChek stores had been positive for the third straight quarter. This indicates that the investment in the QuickChek format, which offers higher-margin fresh food compared to the traditional model, is paying off in terms of sales momentum.

To support this growth, Murphy USA Inc. is expanding its physical footprint. As of September 30, 2025, the company operated 1,620 Murphy USA/Express stores alongside 152 QuickChek stores. The strategy is clearly to invest capital to keep these market-leading merchandise categories growing, aiming for them to eventually transition into Cash Cows when the overall market growth rate inevitably slows down.

Key drivers supporting the Star classification for merchandise include:

• Continued share gains in packaged beverages and candy.
• Merchandise contribution dollars reaching $241.2 million in Q3 2025.
• Non-nicotine contribution dollars growing by 2.8% in Q3 2025.
• QuickChek food and beverage sales positive for three straight quarters (as of Q2 2025).

Finance: draft the capital allocation plan for Q1 2026 emphasizing merchandise CapEx by Friday.

Murphy USA Inc. (MUSA) - BCG Matrix: Cash Cows

The core retail motor fuel sales segment of Murphy USA Inc. exemplifies a Cash Cow, characterized by a high market share in a mature, albeit sometimes volatile, market, which consistently generates significant cash flow to support other parts of the business.

This segment's strength is evident in the second quarter of 2025 performance. Fuel contribution dollars remained substantial, totaling $393.0 million for Q2 2025, a slight increase of 0.7% compared to Q2 2024, primarily driven by margin strength. This indicates the business unit is successfully extracting value from its established market position.

The stability in margin, a hallmark of a Cash Cow, was clear with all-in fuel margins reaching 32.0 cpg in Q2 2025, an improvement of 30 basis points versus the prior-year quarter, even amidst relatively low fuel price volatility. This high, stable margin performance is what allows Murphy USA Inc. to 'milk' the gains passively while minimizing promotional investment in this mature area.

To further illustrate the cash-generating nature of the core business, here are key financial metrics from the Q2 2025 reporting period:

The cash generated by these operations directly funds shareholder returns, which is a key function of a Cash Cow. Murphy USA Inc. demonstrated this commitment through active capital return. During Q2 2025, the company repurchased approximately 470.7 thousand common shares for $211.9 million at an average price of $450.25 per share.

Furthermore, the Board authorized a new $2.0 billion share repurchase program, signaling management's intent to continue returning capital aggressively, especially since they were about 80% through the existing $1.5 billion authorization. This aggressive buyback strategy is employed because management views the stock as undervalued relative to its future cash generation potential.

The consistent dividend policy also reflects the stability of this business unit. The quarterly cash dividend paid in Q2 2025 was $0.50 per share, equating to $2.00 per share on an annualized basis. This policy has been renewed with a compounded annual growth rate of 20% since its inception.

The Cash Cow status supports future investment, though the focus here is on maintenance and milking gains. The company is reinvesting some of this cash flow into infrastructure to improve efficiency, evidenced by the plan to deliver over 45 new stores in 2025 and a pipeline supporting 50-plus stores in 2026.

• Fuel contribution dollars: $393.0 million in Q2 2025.
• All-in fuel margin: 32.0 cpg in Q2 2025.
• New share repurchase authorization: $2.0 billion.
• Q2 2025 quarterly dividend: $0.50 per share.
• Shares repurchased in Q2 2025: Approximately 470.7 thousand.

Murphy USA Inc. (MUSA) - BCG Matrix: Dogs

You're looking at the segments of Murphy USA Inc. (MUSA) that fit the Dog quadrant-low market share in low-growth areas, which typically require careful management to avoid becoming cash traps. These are the units or brands where expensive turn-around plans often don't pay off, making divestiture a prime consideration, though in this context, it often means selective closure or transformation.

The pressure points suggesting a Dog classification stem from declining customer traffic in established locations and rising costs eating into margins at legacy sites. For instance, the core fuel volume metric shows clear weakness in the established base. Same-store sales (SSS) retail fuel volume saw a decline of 2.6% in the third quarter of 2025 when compared to the third quarter of 2024. This indicates that existing, mature locations aren't driving organic volume growth.

The strategy to address these lower-performing, older assets is clear: replacement via the raze-and-rebuild program. These older, smaller-format Murphy USA stores, often the original kiosk models, are candidates for this transformation. Murphy USA Inc. announced plans to execute up to 30 raze-and-rebuilds in 2025, transforming these older kiosks into larger 1,400 square foot stores. This action is a form of managed exit from the 'Dog' state by replacing the asset entirely rather than trying to fix the old structure.

Here's a look at how the operating expenses on these legacy sites are trending, which pressures their cash flow neutrality:

The volatility in the Premium, Sundry, & Other (PS&W) contribution, which bundles in the impact of Renewable Identification Number (RIN) credits, also suggests an unpredictable element often associated with non-core or volatile segments. The contribution from PS&W including RINs has shown significant quarter-to-quarter swings, reflecting market conditions:

• Q3 2025 PS&W including RINs: Increased $21.8 million versus Q3 2024.
• Q2 2025 PS&W including RINs: Increased $8.8 million versus Q2 2024.
• Q1 2025 PS&W including RINs: Was ($15.3 million) compared to $6.7 million in Q1 2024.

When you look specifically at the RINs component for Q1 2025, it was reported at $34.9 million, up from $29.4 million in Q1 2024, showing that the regulatory credit market itself is a source of variability that Murphy USA Inc. has to manage within these units. This volatility means the net cash flow from these operations isn't steady, which is a classic trait of a Dog that isn't performing strongly enough to warrant significant investment to stabilize.

Finally, the rising legacy store operating expenses (OPEX) are a direct drain. Total store and other operating expenses for existing sites are climbing due to higher employee-related expenses and maintenance costs. For example, in Q3 2025, these expenses were $9.8 million higher year-over-year, driven by those exact factors at existing stores. Store OPEX, when excluding payment fees and rent and measured on an Average Per Store Month (APSM) basis, was 3.0% higher in Q3 2025 than in Q3 2024. You see this trend across the year, with Q1 2025 OPEX being $14.0 million higher year-over-year due to these same cost pressures. The math here is simple: declining volume plus rising costs equals a unit that is definitely not generating excess cash.

Finance: draft 13-week cash view by Friday.

Murphy USA Inc. (MUSA) - BCG Matrix: Question Marks

You're looking at the high-growth, high-investment areas of Murphy USA Inc. (MUSA) portfolio-the Question Marks. These are the new ventures that demand significant cash to capture market share in expanding segments. The goal here is aggressive investment to turn them into Stars, or risk them becoming Dogs.

New-to-Industry (NTI) Store Expansion

The primary driver for Question Mark classification at Murphy USA Inc. is the aggressive New-to-Industry (NTI) store expansion program. This strategy consumes substantial capital in the hopes of securing future market dominance. You are seeing a clear acceleration in this area, moving these new concepts into high-growth markets.

Murphy USA Inc. has set ambitious targets for these high-potential, but not yet market-leading, locations:

• Target for new store openings in 2025: Up to 50 new stores.
• New stores opened in the first half of 2025: 14.
• Additional NTIs under construction as of the Q2 2025 call: 40.
• Total new-build c-stores planned by 2033: 500.

These new sites are designed to be larger, effectively doubling the footprint of older models. Here's a comparison of the store formats driving this investment:

If onboarding takes too long, churn risk rises, so construction velocity is key.

Raze-and-Rebuild Program and Capital Allocation

The capital expenditure guidance reflects the heavy investment required to build out this growth pipeline, which includes both new sites and the raze-and-rebuild initiative aimed at modernizing the existing footprint. This spending is what drains cash from the Question Mark quadrant.

The capital budget for 2025 is substantial, covering both the NTI build-out and the modernization of existing assets:

• Total Capital Spending Guidance for 2025: $450 million to $500 million.
• Planned Raze-and-Rebuild Projects for 2025: Up to 30 projects.
• Raze-and-Rebuild Projects Completed in 2024: 47.

The company is prioritizing organic growth over Mergers and Acquisitions (M&A) for significant expansion, viewing organic growth as offering a better capital return.

Technology Investments for Market Penetration

To quickly gain market share and mitigate margin pressure in these growing markets, Murphy USA Inc. is directing funds toward operational technology. While specific AI investment line items aren't broken out separately from the total CapEx, these tools are essential for the success of the new, larger stores.

Here are the key financial projections for the operational environment these Question Marks are entering:

Expansion into New Geographic Markets

These Question Marks are being deployed across the existing operational footprint, which spans a wide area, though market share in these specific new locations is low by definition. The goal is to quickly establish dominance in these new sites within the existing geographic framework.

The current operational footprint provides the base for this expansion:

• Total Store Count (Murphy USA/Express and QuickChek) as of Dec. 31, 2024: 1,757.
• Number of States of Operation: 27.

The company expects to sell just over 5 billion gallons of fuel in 2025, representing a 4.5% increase from 2024, driven by these new, higher-volume locations. Finance: draft 13-week cash view by Friday.