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PBF Energy (PBF) Gains 3.5% as Q3 Earnings Beat Estimates

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PBF Energy Inc. (PBF - Free Report) stock gained 3.5% since it released strong third-quarter 2021 earnings on Oct 28.

The leading North American independent refiner reported third-quarter 2021 earnings of 12 cents per share against the Zacks Consensus Estimate of a loss of 25 cents. The bottom line also turned around from the year-ago loss of $2.87 per share.

Total revenues increased to $7,187 million from $3,668 million in the prior-year quarter and beat the Zacks Consensus Estimate of $6,484 million.

The strong quarterly results can be attributed to a significant improvement in refining margin.

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 $116.7 million, turning around from a loss of $367 million a year ago.

It generated a profit of $47.1 million from the Logistics segment, reflecting a decline from the prior-year quarter’s $55.6 million.

Throughput Analysis

Volumes:

For the quarter under review, crude oil and feedstocks throughput volumes were 848.3 thousand bpd, higher than the year-ago figure of 706.1 thousand bpd.

East Coast, Mid-Continent, Gulf Coast and West Coast regions accounted for 30.6%, 17.2%, 17.1%, and 35, respectively, of the total oil and feedstock throughput volume.

Margins:

Company-wide gross refining margin per barrel of throughput — excluding special items — was recorded at $9.32, significantly higher than the year-earlier $2.98.

Gross refining margin per barrel of throughput was $10 in the East Coast, up from $2.41 in the year-ago quarter. Realized refining margin was $8.40 per barrel in the Gulf Coast, up from $2.48 in the prior-year period. The metric was $8.06 and $11.64 per barrel in the West Coast and Mid-Continent compared with respective margins of $4.43 and $1.87 a year ago.

Costs & Expenses

Total costs and expenses for the reported quarter were $7,085.8 million, significantly higher than $4,010.2 million in the year-ago period. Cost of sales — which includes operating expenses, cost of products and others and depreciation and amortization expenses — amounted to $7,018 million, higher than the year-ago $3,980.8 million.

Capital Expenditure & Balance Sheet

Through the third quarter, the company spent $83.1 million in capital on refining operations and $3.4 million on logistics businesses.

At quarter-end, it had cash and cash equivalents of $1,472.5 million. As of Sep 30, PBF Energy had a total debt of $4,407.1 million, resulting in a total debt to capitalization of 65%.

Outlook

The company continued to expect fuel demand to recover gradually in the coming days. The company reaffirmed its capital spending projection for this year at the band of $400-$450 million.

Zacks Rank & Stocks to Consider

The company carries a Zacks Rank #3 (Hold). A few better-ranked stocks from the energy space include Whiting Petroleum Corporation (WLL - Free Report) , Comstock Resources, Inc. (CRK - Free Report) and APA Corporation (APA - Free Report) . While Comstock carries a Zacks Rank #2 (Buy), Whiting Petroleum and APA Corporation 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.

Comstock is expected to witness earnings growth of 378.3% in 2021.

APA Corporation has seen upward earnings estimate revisions for 2021 in the past 30 days.