As expected WNR misses again, like clock work and they're barely down over the last 2 days. The example of higher std, WNR earnings projections fell from 1.08 to .52 in the last 90 days, HFC from 1.66 to 1.20, that was ridiculous. If they dropped HFC by the same % they should have been at .86/share. I'd like to know who the h_ll comes up with these forecasts and why HFC is expected to well outperform everyone in the group. I don't have a problem with the concept, however the stock price should reflect that premium. As I've stated in the past expect 1.5 - 2BB net cash by year end, lop that off the market cap + this company is cheap.
Well, I'm a nobody who never worked in the industry like yourself + only became self educated on it as I do with any investment I make, so I know a little about a lot, just enough to be dangerous. I try to learn as much as I can before I invest. I do look at your posts as you do know the nuances of the industry + are more knowledgable than myself. You would think the analysts covering this beat would be also. If I can come up with a wag earnings number and I've been lucky to be near it in the past, why can't they. I dreaded this release as you recall I was beating the tom tom's for lowering expectations as they weren't jiving with external forces, crude input costs + lowered spreads.
I also saw the extra divvy as another way to pump up price pre earnings knowing a miss was in the cards. ALL refiners took at best a small hit on their misses and today HFC is down another 3% after falling over 5.7% the past 2 days, an 8.7% hair cut and if you'll notice they missed yearly earnings by only .04! CVI missed and is down almost nothing after their big run up ala Icahn. This stock is held to much higher std's than the rest of the group. As I projected they have over 600MM in net cash + I hope they forget the specials for the time being + build up even more cash. They are also carrying HEP debt and I didn't see any payments from HEP.
They did state margins are better in Q1 which we all knew so earnings will be better sans the output loss with the 1st QTR turnaround. This decline IMO is grossly over done.
I did spell out what I thought they would earn late Dec and at that time I calculated 1.05/share based on crack spreads during the 3rd QTR vs the 4th when it didn't appear that WCS had changed nearly as much as it has since the beginning of the year. IF they do miss it would be the 1st time in a long time for either HOC or FTO or the combined entity. Being realistic, all the refiner's missed even the ones that provided downward guidance late. I expect WNR to miss again, as they have for 5/6 QTR's + yet that stock keeps on ticking with all that debt, now minus what HFC paid them. IMO the special divvy is the result of cash from HEP added to the cash on hand minus any repurchases made. Even if they "only" hit 1.05 that's still another 105MM in the bank which would leave them ~600MM net cash assuming they didn't buyback that many shares + cash did come in from the HEP deal.
I would expect some clarity on UNEV + the plans to spin off to HEP, aka, more cash. Also more details on the 2 turnarounds and exact timing and if costs are going to run close to what they projected last year.
I hope I'm wrong + they at least hit the number.
Refiner's are down across the board. Crude is rising faster than cracks which potentially puts a crimp in refiner profits. Cracks are actually slightly down today but are still a tad below 30 + the brent spread is at 16 but crude is still marching higher now over 109. The reasons are bogus but it is what it is. The Iran situation is overblown. The only refiner up is MPC + ironically they got a mini tender for almost 5% less than what its trading at today.
FINDLAY, Ohio, Feb. 24, 2012 - Marathon Petroleum Corporation (NYSE: MPC - News) has received notification of an unsolicited mini-tender offer by TRC Capital Corporation (TRC Capital) to purchase up to 2,000,000 shares (approximately 0.58 percent) of MPC`s outstanding common stock at a price of $41.50 per share. The offer price was 4.47 percent below the closing price on February 17, 2012, the day prior to the offer.