Market Overview

PBF Energy Downgraded To Neutral At JPMorgan, Says Risk/Return Is 'Fair'

PBF Energy Downgraded To Neutral At JPMorgan, Says Risk/Return Is 'Fair'
Watch These 7 Huge Call Purchases In Friday Trade
Trading A Weakened El Nino

The valuation and leverage combination of PBF Energy Inc (NYSE: PBF) appears less compelling, JPMorgan’s Phil Gresh said in a report. He downgraded the rating for the company from Overweight to Neutral, while reducing the price target from $33 to $21.

“PBF is a unique acquisition story in the refining space with growing geographic diversification, now with exposure in the legacy East Coast and Mid-Con regions in addition to recent acquisitions in the Gulf Coast (Chalmette) and West Coast (Torrance),” analyst Phil Gresh wrote.

PBF Energy’s heavy crude slate and the company’s position in markets that are short products, namely East Coast and LA, offer an advantage. Execution on the Chalmette and Torrance acquisitions could lend upside in the future. For now, “the risk/return profile appears fair,” Gresh commented.

Related Link: Goldman Sachs Downgrades PBF Energy To Neutral, Lowers PT To $26

Estimates Reduced

The 2Q estimates have been reduced again, “as cracks softened in the final weeks of 2Q and capture rates (e.g., tight crude diffs, rising RINs) now look even more negative than we thought q/q,” the analyst said. Full-year estimates have also been reduced, since strip cracks have continued to decline in early 3Q.

The EPS estimates for 2Q and 2016 have been reduced from $0.68 to $0.20 and from $1.25 to $(0.50), respectively.

Did you like this article? Could it have been improved? Please email to let us know!

Latest Ratings for PBF

Aug 2017CitigroupMaintainsBuy
Jul 2017Wolfe ResearchDowngradesOutperformPeer Perform
Jul 2017CitigroupMaintainsBuy

View More Analyst Ratings for PBF
View the Latest Analyst Ratings

Posted-In: JPMorgan Phil GreshAnalyst Color Downgrades Price Target Analyst Ratings Best of Benzinga


Related Articles (PBF)

View Comments and Join the Discussion!