HollyFrontier
Corp, which is the result of a merger of Holly Corp and Frontier Oil in July
2011, is one of the largest independent petroleum refiners in the US
producing gasoline, diesel, jet fuel, asphalt and specialty lubricant
products. Consolidated historical
figures are not yet available; however, earnings per share are expected to grow
from $6.42 in 2011 to $6.75 in 2014 while the dividend per share should
increase from $.33 to $1.40. Return on
equity in 2013 will be roughly 20%. HFC
should benefit from:
(1) economies of
scale from its expanded infrastructure,
(2) margins are
benefiting from heavy crude differentials as well as price differences between
inland and coastal crude,
(3) stock
buybacks.
The
major negative is lack of volume growth.
HFC is rated B++
by Value Line, has a 16% debt to equity ratio and its stock yields 2.4%.
Statistical Summary
Stock Dividend Payout # Increases
Yield Growth Rate Ratio
Since 2011
HFC 2.5% 17% 20 3
Debt/ EPS Down Net Value Line
Equity ROE
Since 20011 Margin Rating
HFC 16% 20% 11 7 B++
Chart
Note:
HFC stock made great progress off its November 2008 low, quickly surpassing the
downtrend off its July 2007 high (red line) and its November 2008 trading high
(green line). Long term, the stock is in
an uptrend (straight blue lines).
Intermediate term, it is in an uptrend (purple lines); although it has
be struggling of late to remain within that trend. The wiggly blue line is on balance
volume. The Aggressive Growth Portfolio
owns a 75% position in HFC. The upper
boundary of its Buy Value
Range Sell Half
Range
12/13
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