Why Energy Company HF Sinclair Shares Are Surging Wednesday

Zinger Key Points
  • HF Sinclair's revenues decline 7% YoY, adjusted EPS beats consensus at $0.71.
  • Refining segment EBITDA drops due to lower gross margins; Renewables segment EBITDA at $(18.6) million.

HF Sinclair Corporation DINO shares are trading higher after it reported first-quarter FY24 results.

Revenues declined 7% Y/Y to $7.027 billion, missing the consensus of $7.542 billion.

Adjusted EBITDA fell 43% Y/Y to $399.1 million in the quarter. Adjusted EPS of $0.71 beat the consensus of $0.65.

The Refining segment adjusted EBITDA declined to $208.8 million from $537.0 million a year ago, owing to lower refinery gross margins in both the West and Mid-Continent regions due to seasonal demand weakness for transportation fuels in the areas.

Lubricants and Specialty Products segment EBITDA stood at $87.0 million vs. $97.6 million a year ago, led by lower base oil prices.

Renewables segment adjusted EBITDA stood at $(18.6) million vs. $3.0 million the prior year. Marketing segment EBITDA was $15.7 million compared to $6.4 million a year ago. 

Operating cash flow stood at $316.9 million in the quarter. As of March-end, cash and equivalents stood at $1.24 billion. 

The company paid $269.0 million to stockholders through dividends and share repurchases in the first quarter. 

Dividend: DINO declared a dividend of $0.50 per share, payable on June 5 to holders of record as of May 22.

Buyback: The company announced a new share repurchase authorization of $1.0 billion.

Investors can gain exposure to the stock via VanEck Oil Refiners ETF  CRAK and First Trust Energy AlphaDEX Fund FXN.

Price Action: DINO shares are trading higher by 4.43% at $57.28 at the last check Wednesday.

Photo by erik-mclean- for Unsplash

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