UPDATE: Bank of America Upgrades HollyFrontier Corp. to Buy, Reiterates $66 PT on Better Balance of Risk

In a report published Thursday, Bank of America analyst Doug Leggate upgraded the rating on HollyFrontier Corp. HFC from Neutral to Buy, and reiterated the $66.00 price target. In the report, Leggate noted, “The recent pullback in the energy sector – and refining in particular - has taken HFC back to levels we believe are supported on the downside by a 7% implied dividend yield (including special) and a management team we believe is poised to buy back shares should weakness continue. WTI-Brent has moved from over $20 to near $10 in just the past few weeks; as a company that runs 100% WTI-based crudes, HFC has been the worst performer in our refining universe YTD. While acknowledging early risks to 2Q earnings estimates, we believe HFC is discounting long-term crude differentials substantially below $10. Upgrade to Buy from Neutral, to exploit a levered play on a potential rebound in spreads, once European refinery maintenance subsides adding a commensurate bid on Brent.” HollyFrontier Corp. closed on Wednesday at $46.88.