UPDATE: J.P. Morgan Upgrades HollyFrontier Corp. to Overweight, Raises PT on Strong Upside Potential

In a report published Monday, J.P. Morgan analyst Katherine Lucas Minyard upgraded the rating on

from Underweight to Overweight, and raised the price target from $42.00 to $66.00. In the report, J.P. Morgan noted, “We have an Overweight rating on HFC. Our revised price target of $66/share suggests more than 40% potential upside, compared with just over 20% for the refiners on average. We believe HFC's inland refining system is well positioned to benefit from growth in production of disadvantaged inland North American crudes, and we expect HFC to capture Brent-WTI price differentials as higher gross margins across the majority of its throughput. In addition, we expect HFC will continue its practice of returning excess cash to shareholders via dividend increases and special dividends, and thus believe yield-oriented investors with a view on sustained wide Brent-WTI differentials will favor HFC among the independent refiners.” HollyFrontier Corp. closed on Friday at $46.91.