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PBF Energy (PBF) Rallies 12.2% Despite Q1 Earnings Miss

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PBF Energy Inc.’s (PBF - Free Report) stock has rallied 12.2% since the company reported first-quarter 2021 results on Apr 29. The stock rose despite reporting wider-than-expected loss since investors are probably optimistic about the company’s constructive outlook for fuel demand.

The leading independent refiner reported first-quarter 2021 loss of $2.61 per share, wider than the Zacks Consensus Estimate of a loss of $2.57 and the year-ago quarter’s loss of $1.19. The underperformance was owing to lower gross refining margin per barrel of throughput.

Total revenues decreased to $4,925 million from $5,278 million in the prior-year quarter. However, the top line beat the Zacks Consensus Estimate of $4,616 million.

PBF Energy Inc. Price, Consensus and EPS Surprise

 

PBF Energy Inc. Price, Consensus and EPS Surprise

PBF Energy Inc. price-consensus-eps-surprise-chart | PBF Energy Inc. Quote

Segmental Performance

The company’s operating income at the Refining segment was $85.9 million against a loss of $1,386.4 million a year ago.

It generated a profit of $47.9 million from the Logistics segment, which reflects a marginal increase from the prior-year quarter’s $47.7 million.

Throughput Analysis

Volumes:

For the quarter under review, crude oil and feedstocks throughput volumes were 745.5 thousand bpd, lower than the year-ago figure of 852.9 thousand bpd.

East Coast, Mid-Continent, Gulf Coast and West Coast regions accounted for 32.6%, 15.7%, 20.6%, and 31.1%, respectively, of total oil and feedstock throughput volume. 

Margins:

Company-wide gross refining margin per barrel of throughput — excluding special items — was recorded at $3.65, significantly lower than the year-earlier quarter’s $6.60.

Gross refining margin per barrel of throughput was $2.48 in the East Coast, down from $6.92 in the year-earlier quarter. Realized refining margin was $5.44 per barrel in the Gulf Coast, down from $8.07 in the prior-year period. Notably, the metric was $2.91 and $5.18 per barrel in the West Coast and Mid-Continent, as compared with $7.09 and $1.16, respectively, a year ago.

Costs & Expenses

Total costs and expenses for the reported quarter were $4,867.1 million, significantly lower than $6,644.3 million in the year-ago period. Cost of sales — which includes operating expenses, cost of products and others — amounted to $4,786.4 million, lower than the year-ago level of $6,611.7 million.

Capital Expenditure & Balance Sheet

Through the first quarter, the company spent $58.1 million capital on refining operations and $1.3 million on logistics businesses.

At quarter-end, it had cash and cash equivalents of $ 1,541.2 million. As of Mar 31, PBF Energy had a total debt of $4,657.9 million, resulting in total debt to capitalization of 68.2%. 

Outlook

The company expects fuel demand to recover gradually in the second half of this year. Notably, the company projects capital spending for this year in the band of $400 to $450 million.

Zacks Rank & Stocks to Consider

PBF Energy currently carries a Zacks Rank #3 (Hold). Meanwhile, a few better-ranked players in the energy space include Whiting Petroleum Corporation (WLL - Free Report) , Continental Resources, Inc. (CLR - Free Report) and Matador Resources Company (MTDR - Free Report) . All the stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Whiting Petroleum has witnessed upward earnings estimate revisions for 2021 in the past 30 days.

Continental is expected to witness earnings growth of 256% in 2021.

Matador is likely to see earnings growth of 300% in 2021.

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