NYSE:HEP

Stock Analysis Report

Holly Energy Partners

Executive Summary

Holly Energy Partners, L.P. owns and operates petroleum product and crude pipelines, storage tanks, distribution terminals, loading rack facilities, and refinery processing units that support the refining and marketing operations of HollyFrontier Corporation in West Texas, New Mexico, Utah, Nevada, Oklahoma, Wyoming, Kansas, Arizona, Idaho, and Washington.

Rewards


Snowflake Analysis


Similar Companies

Share Price & News

How has Holly Energy Partners's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HEP has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.6%

HEP

-4.6%

US Oil and Gas

-1.3%

US Market


1 Year Return

-20.9%

HEP

-10.4%

US Oil and Gas

22.0%

US Market

Return vs Industry: HEP underperformed the US Oil and Gas industry which returned -4.2% over the past year.

Return vs Market: HEP underperformed the US Market which returned 24.7% over the past year.


Shareholder returns

HEPIndustryMarket
7 Day-1.6%-4.6%-1.3%
30 Day5.6%-6.3%1.8%
90 Day5.7%-2.9%9.3%
1 Year-12.8%-20.9%-7.0%-10.4%24.6%22.0%
3 Year-18.1%-36.5%-12.1%-20.2%49.2%39.6%
5 Year7.3%-26.5%-13.9%-26.4%77.9%58.3%

Price Volatility Vs. Market

How volatile is Holly Energy Partners's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Holly Energy Partners undervalued compared to its fair value and its price relative to the market?

6.7%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HEP ($24) is trading below our estimate of fair value ($25.5)

Significantly Below Fair Value: HEP is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: HEP is poor value based on its PE Ratio (11.2x) compared to the Oil and Gas industry average (10.2x).

PE vs Market: HEP is good value based on its PE Ratio (11.2x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

PEG Ratio: HEP's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: HEP is overvalued based on its PB Ratio (6.3x) compared to the US Oil and Gas industry average (1x).

Future Growth

How is Holly Energy Partners forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

-1.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HEP's earnings are forecast to decline over the next 3 years (-1.8% per year).

Earnings vs Market: HEP's earnings are forecast to decline over the next 3 years (-1.8% per year).

High Growth Earnings: HEP's earnings are forecast to decline over the next 3 years.

Revenue vs Market: HEP's revenue is expected to decline over the next 3 years (-0.02% per year).

High Growth Revenue: HEP's revenue is forecast to decline over the next 3 years (-0.02% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HEP's Return on Equity is forecast to be very high in 3 years time (58.2%).

Past Performance

How has Holly Energy Partners performed over the past 5 years?

24.7%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HEP has high quality earnings.

Growing Profit Margin: HEP's current net profit margins (42.5%) are lower than last year (43.2%).


Past Earnings Growth Analysis

Earnings Trend: HEP's earnings have grown significantly by 24.7% per year over the past 5 years.

Accelerating Growth: HEP's earnings growth over the past year (4.3%) is below its 5-year average (24.7% per year).

Earnings vs Industry: HEP earnings growth over the past year (4.3%) exceeded the Oil and Gas industry -13.3%.


Return on Equity

High ROE: Whilst HEP's Return on Equity (43.73%) is outstanding, this metric is skewed due to their high level of debt.


Return on Assets


Return on Capital Employed

Financial Health

How is Holly Energy Partners's financial position?


Financial Position Analysis

Short Term Liabilities: HEP's short term assets ($64.2M) exceed its short term liabilities ($53.4M).

Long Term Liabilities: HEP's short term assets ($64.2M) do not cover its long term liabilities ($1.6B).


Debt to Equity History and Analysis

Debt Level: HEP's debt to equity ratio (266.6%) is considered high.

Reducing Debt: HEP's debt to equity ratio has increased from 187.6% to 266.6% over the past 5 years.

Debt Coverage: HEP's debt is well covered by operating cash flow (21.4%).

Interest Coverage: HEP's interest payments on its debt are well covered by EBIT (3.7x coverage).


Balance Sheet

Inventory Level: HEP has a high level of physical assets or inventory.

Debt Coverage by Assets: HEP's debt is not covered by short term assets (assets are 0x debt).

Dividend

What is Holly Energy Partners's current dividend yield, its reliability and sustainability?

11.19%

Current Dividend Yield


Dividend Yield vs Market

company11.2%marketbottom25%1.4%markettop25%3.7%industryaverage4.2%forecastin3Years10.5%

Current dividend yield vs market & industry

Notable Dividend: HEP's dividend (11.21%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: HEP's dividend (11.21%) is in the top 25% of dividend payers in the US market (3.66%)


Stability and Growth of Payments

Stable Dividend: HEP's dividends per share have been stable in the past 10 years.

Growing Dividend: HEP's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (124.7%), HEP's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HEP's dividends in 3 years are not forecast to be well covered by earnings (128.4% payout ratio).

Management

What is the CEO of Holly Energy Partners's salary, the management and board of directors tenure and is there insider trading?

2.0yrs

Average management tenure


CEO

Mike Jennings (53yo)

0yrs

Tenure

US$210,656

Compensation

Mr. Michael C. Jennings, also known as Mike, serves as Chief Executive Officer and President of HollyFrontier Corporation since January 1, 2020. Mr. Jennings serves as Chief Executive Officer at Holly Logi ...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD0.00) is below average for companies of similar size in the US market ($USD4.99M).

Compensation vs Earnings: Mike's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.0yrs

Average Tenure

53yo

Average Age

Experienced Management: HEP's management team is considered experienced (2 years average tenure).


Board Age and Tenure

2.2yrs

Average Tenure

66yo

Average Age

Experienced Board: HEP's board of directors are not considered experienced ( 2.2 years average tenure), which suggests a new board.


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

SellUS$55,10006 Aug 19
Eric Mattson
EntityIndividual
Role
Member of the Board of Directors
Director of Holly Logistic Services LLC
Shares2,000
Max PriceUS$27.65

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 4.3%.


Management Team

  • Mike Jennings (53yo)

    Chairman & CEO of Holly Logistic Services LLC

    • Compensation: US$210.66k
  • Rich Voliva (41yo)

    President of Holly Logistic Services LLC

    • Compensation: US$654.22k
  • Mark Cunningham (59yo)

    Senior Vice President of Operations & Engineering - Holly Logistic Services

    • Tenure: 2yrs
    • Compensation: US$794.58k
  • Kenneth Norwood (53yo)

    Vice President and Controller of Holly Logistic Services LLC

    • Tenure: 5.8yrs
  • Craig Biery

    Director of Investor Relations

    • John Harrison (40yo)

      Senior VP

      • Jared Harding

        Investor Relations Officer

        • Trey Schonter

          Executive of Investor Relations

          • Vaishali Bhatia

            Senior VP

            • Tenure: 0.2yrs

          Board Members

          • Mike Jennings (53yo)

            Chairman & CEO of Holly Logistic Services LLC

            • Compensation: US$210.66k
          • James Lee (70yo)

            Independent Director of Holly Logistic Services LLC

            • Tenure: 2.2yrs
            • Compensation: US$103.01k
          • Eric Mattson (67yo)

            Director of Holly Logistic Services LLC

            • Tenure: 1.8yrs
          • Christine LaFollette (66yo)

            Director of Holly Logistic Services LLC

            • Tenure: 1.8yrs
          • Larry Baldwin (66yo)

            Director of Holly Logistic Services LLC

            • Tenure: 3.7yrs
            • Compensation: US$228.03k

          Company Information

          Holly Energy Partners, L.P.'s company bio, employee growth, exchange listings and data sources


          Key Information

          • Name: Holly Energy Partners, L.P.
          • Ticker: HEP
          • Exchange: NYSE
          • Founded: 2004
          • Industry: Oil and Gas Storage and Transportation
          • Sector: Energy
          • Market Cap: US$2.567b
          • Shares outstanding: 105.44m
          • Website: https://www.hollyenergy.com

          Location

          • Holly Energy Partners, L.P.
          • 2828 North Harwood
          • Suite 1300
          • Dallas
          • Texas
          • 75201
          • United States

          Listings

          TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
          HEPNYSE (New York Stock Exchange)YesCommon UnitsUSUSDJul 2004
          HHNDB (Deutsche Boerse AG)YesCommon UnitsDEEURJul 2004

          Biography

          Holly Energy Partners, L.P. owns and operates petroleum product and crude pipelines, storage tanks, distribution terminals, loading rack facilities, and refinery processing units that support the refining and marketing operations of HollyFrontier Corporation in West Texas, New Mexico, Utah, Nevada, Oklahoma, Wyoming, Kansas, Arizona, Idaho, and Washington. It operates through Pipelines and Terminals, and Refinery Processing Units segments. The company operates refined product pipelines that transport conventional gasolines, reformulated gasolines, and low-octane gasolines for oxygenate blending, as well as distillates, such as high- and low-sulfur diesel and jet fuels, and liquefied petroleum gases; intermediate product pipelines that transport intermediate feedstocks and crude oils; and oil trunk, gathering, and connection pipelines that delivers crude oil. It operates 26 main pipelines; crude gathering networks; 10 refined product terminals; 1 crude terminal; 31,800 track feet of rail storage; 7 locations with truck and/or rail racks; and tankages at 6 refining facility locations, as well as 5 refinery processing units. HEP Logistics Holdings, L.P. serves as the general partner of the company. Holly Energy Partners, L.P. was founded in 2004 and is based in Dallas, Texas. Holly Energy Partners, L.P. operates as a subsidiary of HollyFrontier Corporation 


          Company Analysis and Financial Data Status

          All financial data provided by Standard & Poor's Capital IQ.
          DataLast Updated (UTC time)
          Company Analysis2020/01/25 00:11
          End of Day Share Price2020/01/24 00:00
          Earnings2019/09/30
          Annual Earnings2018/12/31


          Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.