S&P upgrades Murphy USA

Standard & Poor’s said it raised the corporate credit rating on Murphy USA Inc. to BB+ from BB.

The agency also said it raised the ratings on the company’s $500 million unsecured notes to BB+ from BB. The recovery rating remains at 3, indicating 50% to 70% expected default recovery.

The outlook is stable.

The upgrades reflect the company’s good financial performance, which has exceeded expectations, S&P said.

Upon separation from its parent, Murphy Oil Corp. in 2013, Murphy USA focused on a leverage target of less than 2.5x, the agency said.

The company used proceeds from assets sales and cash flows to reduce debt and leverage has remained at less than 1.5x for five consecutive quarters, Moody’s said.

The agency said it does not anticipate any additional funded debt as the company is expected to use generated funds and cash balances to support its growth program.

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