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    What Suburban Propane Partners (SPH)'s 2035 Debt Refinance Means For Shareholders

    Simply Wall St·12/26/2025 01:22:12
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    • Suburban Propane Partners, L.P. has completed a private offering of US$350 million in 6.500% Senior Notes due 2035, with net proceeds of about US$344.3 million earmarked, together with revolving credit borrowings, to redeem its 5.875% senior notes due 2027 and cover related costs.
    • By refinancing shorter‑dated 2027 notes with longer‑maturity 2035 debt, the partnership is reshaping its debt schedule and potentially increasing financial flexibility for its core propane and renewable fuel initiatives.
    • We’ll now explore how replacing 2027 notes with longer‑dated 2035 debt may influence Suburban Propane Partners’ investment narrative and risk profile.

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    Suburban Propane Partners Investment Narrative Recap

    To own Suburban Propane Partners, you need to believe its mature propane franchise can keep funding distributions while newer renewable fuel projects gradually matter more. The new 6.500% 2035 notes modestly reshape its balance sheet but do not materially change the key near term catalyst around renewable natural gas execution or the main risk from high leverage and interest coverage pressure.

    The recent completion of the US$350.0 million 2035 senior notes offering ties directly to that leverage question, since it extends maturities while keeping interest costs elevated. Set against 2025 full year net income of US$106.57 million and an ongoing US$0.325 per unit quarterly distribution, this refinancing sits at the heart of how comfortably Suburban Propane can fund both growth in cleaner fuels and its current payout.

    Yet investors should be aware that, despite the extended maturity profile, the combination of relatively high leverage and interest obligations could still...

    Read the full narrative on Suburban Propane Partners (it's free!)

    Suburban Propane Partners' narrative projects $1.5 billion revenue and $132.3 million earnings by 2028. This implies a 1.0% yearly revenue decline and a $35.2 million earnings increase from $97.1 million today.

    Uncover how Suburban Propane Partners' forecasts yield a $17.00 fair value, a 9% downside to its current price.

    Exploring Other Perspectives

    SPH 1-Year Stock Price Chart
    SPH 1-Year Stock Price Chart

    One Simply Wall St Community member currently pegs fair value at US$17.00, underscoring how a single view can differ from market pricing. Against that backdrop, the partnership’s elevated leverage and interest coverage constraints put a sharper focus on how its new 2035 debt might influence future financial resilience and income stability.

    Explore another fair value estimate on Suburban Propane Partners - why the stock might be worth as much as $17.00!

    Build Your Own Suburban Propane Partners Narrative

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    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.