if there are earnings, share buybacks increase the earnings per share. this typically results in a ;higher share price down the line. sometimes, its way down the line
they only make 6000 BPD of Diesel there. How can a small or modest diesel margin move the needle on this company? at $10/bbl the profit would be $60K/day. about $5MM a quarter. peanuts. They were hoping for 50$/bbl when they made this investment. Its not there anymore. Saudis took away the punch bowl.
show me a quarter in the past ten years where refiner spreads did not narrow in Q4 vs. Q3. DAh. That is no reason to dump the stock. Refiners should be measured on Q4 this year vs. Q4 last year, just like Macy's
in the past 90 days the stock price is down 25%, while the 2016 earnings estimate is up 25%. Something has to give.
normal operating costs in a large refinery might be $5/bbl. because they are so small, ongoing costs to process a barrel of crude might be $10-12. I would guess they would be breaking even. Need really good diesel margins, or very large local crude discounts to make it work. no real harm being done. its not a big part of the overall company. The Montana Expansion, due to start soon is a bigger investment, and more likely to pay out.
crack and retail margins have shrunk oner past month RELATIVE to Q3. But Q3 TSO earned about half the money in Ft. Knox. Geez. I think this winter period will end up being the strongest ever. And absent a US recession, the driving season margins should be right back if not above last year. They could easily make $12/ share earnings, and possibly $15/ Share with a little market tightness caused by other plants being down unscheduled. How can we not be given a 10 PE when the earnings are strong and rising???? Im long, and Im buying options every month. Someday I will be right.
recent company spreadsheet shows capture of huge retail margin even as crack spread has declined on West Coast. good for earnings. no more going to break even in Q1
they have the lowest cost of production on an essential product. how can they not do well. better than most companies. even in a downturn. they can manage their cash flow where others are at the mercy of the market. the Chinese cannot export enough to make a difference. this move down is crazy.
yep. a purchase now, would gain lots of cash and suffer very low debt load for a facility of this quality. much smaller bite than going after HFC which is the other jewel
somebody is buying cheap. volume today looks normal, unlike all the other refiners where there is very light volume. I think TSO drops a tender sooner rather than later.
June Crack Spread (3-2-1) from futures page is $18/bbl. that will more than cover the dividend. the cash burn will be over by then. And maybe the discussion will switch to distribution increases. And debt pay down.
very curious to see if it hold into Jan. Might. the inventory trends usually are going straight up this time of year, and are holding flat. Product exports keep going up and up. This looks like a new paradyhme. Ryhmes with Thyme, and better valuable than a dime. Love words.
Also like being right in this sector. had the timing wrong so many times.
Holly gets to buy the mid continent crude for well head prices. If the West or East Coast refineries want to run it, they have to pay the shipping cost. And that means trains, and that added cost gets pocketed by HFC to run that crude in Midcon. No Impact. The export ban, means somebody would have to pay even more shipping cost to export it by ship to ??? Who but the Mexicans would want it., and they can't keep their refineries running more than half the year.
SoCal gas margins have spiked an additional $15/bbl for last 2 weeks of quarter. Already the 4Q stayed very positive vs. traditional sub $10 crack spread for winter months. Forward curve still showing decent profits for '16 Q1 . Better than normal. Likely to carry over into Spring months when margins typically rise to seasonal highs.