UPDATE: Bank of America Upgrades HollyFrontier as New Price Volatility Plays to Company's Advantage
In a report published Tuesday, Bank of America analyst Doug Leggate upgraded the rating on HollyFrontier Corp. (NYSE: HFC) from Neutral to Buy, and raised the price target from $51.00 to $60.00.
In the report, Bank of America noted, “HollyFrontier has lagged an early seasonal rebound in the US refining sector that has accompanied the expansion in US crude differentials. To some extent we believe this reflects a lack of exposure to the Gulf Coast where an expansion in sour and heavy differentials has anchored a ~30% rebound in export levered refiners since Sept. Near term we believe this has been exacerbated by regional downtime with multiple refineries offline; however with rising crude production and stagnant light crude capacity in the lower 48 we believe current WTI-Brent spreads near $17 have broader implications for inland differentials introducing a new layer of seasonal price volatility that plays to HFC's advantage. Upgrade to Buy, PO $60/sh.”
HollyFrontier closed on Monday at $49.17.
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