OPAL FuelsStar Group

OPAL Fuels vs Star Group

OPAL Fuels and Star Group compare business models, financial performance, and market context to show how these two organisations operate within the energy sector. The page explains strategy, revenue d...

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Australia's Fuel Retail Shake-Up

Australia's Fuel Retail Shake-Up

Ampol's acquisition of EG Group's Australian sites marks a major consolidation in the nation's fuel retail sector. This move intensifies competition, creating potential opportunities for other retailers and suppliers who may benefit from the shifting market dynamics.

Published: August 14, 2025

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Investment Analysis

Pros

  • OPAL Fuels is a nationwide leader in producing and distributing renewable natural gas for medium and heavy-duty trucking fleets in the U.S.
  • The company has demonstrated revenue growth of over 17% in 2024, reaching nearly $300 million.
  • OPAL Fuels is expanding into renewable energy segments like hydrogen fueling stations, aligning with decarbonisation trends.

Considerations

  • Despite revenue growth, OPAL's earnings sharply declined by over 97% in 2024, signaling profitability challenges.
  • The stock carries a high price-to-earnings ratio indicative of valuation risk and uncertain near-term profitability.
  • Analyst consensus on the stock is predominantly negative with a 'Sell' rating and a moderate upside target.

Pros

  • Star Group serves a large customer base with over 400,000 full-service residential and commercial heating oil and propane customers plus roughly 27,000 fuel customers.
  • It operates in a niche energy distribution market with diverse offerings including heating oil, propane, gasoline, diesel, and HVAC services.
  • Star Group has a stable operational history dating back to 1995 and generates recurring demand through critical home heating services.

Considerations

  • The company’s core business is exposed to commodity price fluctuations in heating oil, propane, gasoline, and diesel markets, affecting margins.
  • Its growth is largely dependent on traditional fossil fuel products in a global environment transitioning to renewable energy.
  • Star Group’s business is regionally focused in the United States, limiting geographic diversification and exposing it to regional economic cycles.

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