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HollyFrontier (HFC) Incurs Wider-Than-Expected Loss in Q1
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U.S. refiner HollyFrontier Corporation reported first-quarter 2021 net loss per share (excluding special items) of 53 cents, wider than the Zacks Consensus Estimate of a loss of 45 cents. In the year-ago period, the company earned 53 cents per share.
The underperformance reflects a decline in refining margins and throughput, partially offset by robust results from the lubricants and the pipeline divisions.
Revenues of $3.5 billion beat the Zacks Consensus Estimate of $2.8 billion and improved 3.1% from first-quarter 2020 sales of $3.4 billion.
HollyFrontier Corporation Price, Consensus and EPS Surprise
Refining: Adjusted loss from the Refining segment, which is the main contributor to HollyFrontier’s earnings, was $65.8 million. This reflected a massive plunge from the year-ago quarter’s income of $175.9 million, primarily due to sharply narrower gross margins, which were down 28% to $8 per barrel. On a somewhat positive note, margins came above the Zacks Consensus Estimate of $6.88 per barrel.
Total refined product sales volumes averaged 354,940 barrels per day (bpd), down 13.4% from 409,850 bpd in the year-ago quarter. Moreover, throughput decreased from 425,260 bpd in the year-ago quarter to 374,160 bpd and fell short of the Zacks Consensus Estimate of 395,000 bpd. Meanwhile, capacity utilization was 86%, down from 96.9% in first-quarter 2020.
Lubricants and Specialty Products: The segment EBITDA totaled $87.1 million, compared to $32.3 million reported in the year-ago quarter, primarily reflecting a strong base oil market. Product sales averaged 32,570 bpd, decreasing from the prior-year level of 36,800 bpd. Throughput was also down 6.2% year over year to 20,410 bpd in the reported quarter.
HEP: This unit includes HollyFrontier’s majority interest in Holly Energy Partners L.P. , a publicly-traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets.
Segment EBITDA was $96.2 million, up from $64.4 million in first-quarter 2020. Earnings were buoyed by minimum volume commitments.
Balance Sheet
As of Mar 31, HollyFrontier had approximately $1.2 billion in cash and cash equivalents, and $3.1 billion in long-term debt, representing a debt-to-capitalization of 34.9%.
During the quarter, the company paid $57.7 million in dividends.
Zacks Rank & Stock Picks
HollyFrontier currently carries a Zacks Rank #4 (Sell).
Some better-ranked players in the energy space are Exxon Mobil Corporation (XOM - Free Report) and Suncor Energy (SU - Free Report) . Both the companies sport a Zacks Rank #1 (Strong Buy).
ExxonMobil has an expected earnings growth rate of 1,139.39% for the current year.
Suncor Energy has an expected earnings growth rate of 223.64% for the current year.
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HollyFrontier (HFC) Incurs Wider-Than-Expected Loss in Q1
U.S. refiner HollyFrontier Corporation reported first-quarter 2021 net loss per share (excluding special items) of 53 cents, wider than the Zacks Consensus Estimate of a loss of 45 cents. In the year-ago period, the company earned 53 cents per share.
The underperformance reflects a decline in refining margins and throughput, partially offset by robust results from the lubricants and the pipeline divisions.
Revenues of $3.5 billion beat the Zacks Consensus Estimate of $2.8 billion and improved 3.1% from first-quarter 2020 sales of $3.4 billion.
HollyFrontier Corporation Price, Consensus and EPS Surprise
HollyFrontier Corporation price-consensus-eps-surprise-chart | HollyFrontier Corporation Quote
Segmental Information
Refining: Adjusted loss from the Refining segment, which is the main contributor to HollyFrontier’s earnings, was $65.8 million. This reflected a massive plunge from the year-ago quarter’s income of $175.9 million, primarily due to sharply narrower gross margins, which were down 28% to $8 per barrel. On a somewhat positive note, margins came above the Zacks Consensus Estimate of $6.88 per barrel.
Total refined product sales volumes averaged 354,940 barrels per day (bpd), down 13.4% from 409,850 bpd in the year-ago quarter. Moreover, throughput decreased from 425,260 bpd in the year-ago quarter to 374,160 bpd and fell short of the Zacks Consensus Estimate of 395,000 bpd. Meanwhile, capacity utilization was 86%, down from 96.9% in first-quarter 2020.
Lubricants and Specialty Products: The segment EBITDA totaled $87.1 million, compared to $32.3 million reported in the year-ago quarter, primarily reflecting a strong base oil market. Product sales averaged 32,570 bpd, decreasing from the prior-year level of 36,800 bpd. Throughput was also down 6.2% year over year to 20,410 bpd in the reported quarter.
HEP: This unit includes HollyFrontier’s majority interest in Holly Energy Partners L.P. , a publicly-traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets.
Segment EBITDA was $96.2 million, up from $64.4 million in first-quarter 2020. Earnings were buoyed by minimum volume commitments.
Balance Sheet
As of Mar 31, HollyFrontier had approximately $1.2 billion in cash and cash equivalents, and $3.1 billion in long-term debt, representing a debt-to-capitalization of 34.9%.
During the quarter, the company paid $57.7 million in dividends.
Zacks Rank & Stock Picks
HollyFrontier currently carries a Zacks Rank #4 (Sell).
Some better-ranked players in the energy space are Exxon Mobil Corporation (XOM - Free Report) and Suncor Energy (SU - Free Report) . Both the companies sport a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank stocks here.
ExxonMobil has an expected earnings growth rate of 1,139.39% for the current year.
Suncor Energy has an expected earnings growth rate of 223.64% for the current year.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
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