NYSE:HFC

Stock Analysis Report

Executive Summary

HollyFrontier Corporation operates as an independent petroleum refiner in the United States.

Rewards

Trading at 1.5% below its fair value

Risk Analysis

Earnings are forecast to decline by an average of -0.7% per year for the next 3 years

Unstable dividend track record

Highly volatile share price over past 3 months

Profit margins (4.9%) are lower than last year (8.5%)



Snowflake Analysis

Adequate balance sheet average dividend payer.


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CVR Energy

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Share Price & News

How has HollyFrontier's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: HFC's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-0.8%

HFC

-4.6%

US Oil and Gas

-1.3%

US Market


1 Year Return

-15.5%

HFC

-10.3%

US Oil and Gas

22.0%

US Market

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

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


Shareholder returns

HFCIndustryMarket
7 Day-0.8%-4.6%-1.3%
30 Day-9.7%-6.1%1.6%
90 Day-19.0%-2.8%8.9%
1 Year-13.2%-15.5%-7.0%-10.3%24.7%22.0%
3 Year75.4%60.0%-12.0%-20.1%49.4%39.7%
5 Year53.1%29.5%-13.8%-26.2%78.1%58.5%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

Is HollyFrontier undervalued compared to its fair value and its price relative to the market?

2.8%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: HFC ($46.92) is trading below our estimate of fair value ($47.62)

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


Price To Earnings Ratio

PE vs Industry: HFC is good value based on its PE Ratio (9.6x) compared to the Oil and Gas industry average (10.2x).

PE vs Market: HFC is good value based on its PE Ratio (9.6x) compared to the US market (18.9x).


Price to Earnings Growth Ratio

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


Price to Book Ratio

PB vs Industry: HFC is overvalued based on its PB Ratio (1.3x) compared to the US Oil and Gas industry average (1x).


Next Steps

Future Growth

How is HollyFrontier forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

-5.7%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: HFC's earnings are forecast to decline over the next 3 years (-0.7% per year).

Earnings vs Market: HFC's earnings are forecast to decline over the next 3 years (-0.7% per year).

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

Revenue vs Market: HFC's revenue (1% per year) is forecast to grow slower than the US market (7.5% per year).

High Growth Revenue: HFC's revenue (1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: HFC's Return on Equity is forecast to be low in 3 years time (14.2%).


Next Steps

Past Performance

How has HollyFrontier performed over the past 5 years?

26.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: HFC has high quality earnings.

Growing Profit Margin: HFC's current net profit margins (4.9%) are lower than last year (8.5%).


Past Earnings Growth Analysis

Earnings Trend: HFC's earnings have grown significantly by 26.9% per year over the past 5 years.

Accelerating Growth: HFC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: HFC had negative earnings growth (-42%) over the past year, making it difficult to compare to the Oil and Gas industry average (-13.3%).


Return on Equity

High ROE: HFC's Return on Equity (14.6%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is HollyFrontier's financial position?


Financial Position Analysis

Short Term Liabilities: HFC's short term assets ($3.5B) exceed its short term liabilities ($1.7B).

Long Term Liabilities: HFC's short term assets ($3.5B) do not cover its long term liabilities ($3.9B).


Debt to Equity History and Analysis

Debt Level: HFC's debt to equity ratio (37.6%) is considered satisfactory.

Reducing Debt: HFC's debt to equity ratio has increased from 15.9% to 37.6% over the past 5 years.

Debt Coverage: HFC's debt is well covered by operating cash flow (74.6%).

Interest Coverage: HFC's interest payments on its debt are well covered by EBIT (12.6x coverage).


Balance Sheet

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

Debt Coverage by Assets: HFC's debt is covered by short term assets (assets are 1.4x debt).


Next Steps

Dividend

What is HollyFrontier's current dividend yield, its reliability and sustainability?

3.01%

Current Dividend Yield


Dividend Yield vs Market

company3.0%marketbottom25%1.4%markettop25%3.7%industryaverage4.3%forecastin3Years3.1%

Current dividend yield vs market & industry

Notable Dividend: HFC's dividend (2.89%) is higher than the bottom 25% of dividend payers in the US market (1.4%).

High Dividend: HFC's dividend (2.89%) is low compared to the top 25% of dividend payers in the US market (3.66%).


Stability and Growth of Payments

Stable Dividend: HFC's dividend payments have been volatile in the past 10 years.

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


Current Payout to Shareholders

Dividend Coverage: With its reasonably low payout ratio (26.2%), HFC's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: HFC's dividends in 3 years are forecast to be well covered by earnings (27.3% payout ratio).


Next Steps

Management

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

3.4yrs

Average management tenure


CEO

Mike Jennings (53yo)

0yrs

Tenure

US$467,034

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 ($USD467.03K) is below average for companies of similar size in the US market ($USD6.46M).

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


Management Age and Tenure

3.4yrs

Average Tenure

53yo

Average Age

Experienced Management: HFC's management team is considered experienced (3.4 years average tenure).


Board Age and Tenure

9.0yrs

Average Tenure

64.5yo

Average Age

Experienced Board: HFC's board of directors are considered experienced (9 years average tenure).


Insider Trading

Insider Buying: HFC insiders have only sold shares in the past 3 months.


Recent Insider Transactions

SellUS$515,00023 Dec 19
Thomas Creery
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Commercial
Shares10,000
Max PriceUS$51.50
SellUS$255,00020 Dec 19
Thomas Creery
EntityIndividual
Role
Senior Key Executive
Senior Vice President of Commercial
Shares5,000
Max PriceUS$51.00
SellUS$1,017,60019 Dec 19
Richard Voliva
EntityIndividual
Role
Chief Financial Officer
Executive VP & CFO
Shares20,000
Max PriceUS$50.88
SellUS$414,18319 Dec 19
John Gann
EntityIndividual
Role
Chief Accounting Officer
Chief Accounting Officer
Shares8,150
Max PriceUS$50.82
SellUS$370,79421 Nov 19
John Gann
EntityIndividual
Role
Chief Accounting Officer
Chief Accounting Officer
Shares7,052
Max PriceUS$52.58
BuyUS$124,30006 Aug 19
Franklin Myers
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares2,500
Max PriceUS$49.72
BuyUS$124,06209 May 19
Franklin Myers
EntityIndividual
Role
Chairman of the Board
Independent Chairman of the Board
Shares2,900
Max PriceUS$42.78
SellUS$497,43025 Feb 19
Michael Jennings
EntityIndividual
Role
Chief Executive Officer
CEO, President & Director
Shares9,000
Max PriceUS$55.27

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Mike Jennings (53yo)

    CEO, President & Director

    • Compensation: US$467.03k
  • William Gray (78yo)

    Senior VP

    • Compensation: US$110.35k
  • Rich Voliva (41yo)

    Executive VP & CFO

    • Tenure: 2.8yrs
    • Compensation: US$3.27m
  • John Gann (61yo)

    Chief Accounting Officer

    • James Stump (51yo)

      Senior Vice President of Refining

      • Tenure: 8.5yrs
      • Compensation: US$2.22m
    • Tom Creery (60yo)

      Senior Vice President of Commercial

      • Tenure: 4yrs
      • Compensation: US$2.12m
    • Paige Kester

      Vice President of Aquisitions & Corporate Development

      • Tenure: 7yrs
    • Craig Biery

      Director of Investor Relations

      • John Harrison (40yo)

        VP of Finance

        • Tenure: 1.3yrs
      • Vaishali Bhatia

        Senior VP

        • Tenure: 0.4yrs

      Board Members

      • Franklin Myers (66yo)

        Independent Chairman of the Board

        • Tenure: 0.9yrs
        • Compensation: US$299.03k
      • Mike Jennings (53yo)

        CEO, President & Director

        • Compensation: US$467.03k
      • James Lee (70yo)

        Independent Director

        • Tenure: 9yrs
        • Compensation: US$282.53k
      • Doug Bech (73yo)

        Independent Lead Director

        • Compensation: US$331.03k
      • Bob Kostelnik (67yo)

        Independent Director

        • Tenure: 9yrs
        • Compensation: US$308.63k
      • Anna Catalano (60yo)

        Independent Director

        • Tenure: 2.2yrs
        • Compensation: US$282.63k
      • Lel Echols (63yo)

        Independent Director

        • Tenure: 11yrs
        • Compensation: US$310.03k
      • Mike Rose (72yo)

        Independent Director

        • Tenure: 9yrs
        • Compensation: US$302.53k
      • Anne-Marie Ainsworth (63yo)

        Independent Director

        • Tenure: 2.2yrs
        • Compensation: US$285.03k
      • Craig Knocke (49yo)

        Independent Director

        • Tenure: 0.9yrs

      Company Information

      HollyFrontier Corporation's company bio, employee growth, exchange listings and data sources


      Key Information

      • Name: HollyFrontier Corporation
      • Ticker: HFC
      • Exchange: NYSE
      • Founded: 1947
      • Industry: Oil and Gas Refining and Marketing
      • Sector: Energy
      • Market Cap: US$7.454b
      • Shares outstanding: 160.20m
      • Website: https://www.hollyfrontier.com

      Number of Employees


      Location

      • HollyFrontier Corporation
      • 2828 North Harwood
      • Suite 1300
      • Dallas
      • Texas
      • 75201
      • United States

      Listings

      TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
      HFCNYSE (New York Stock Exchange)YesCommon StockUSUSDJan 1968
      HL8DB (Deutsche Boerse AG)YesCommon StockDEEURJan 1968

      Biography

      HollyFrontier Corporation operates as an independent petroleum refiner in the United States. The company operates through three segments: Refining, Lubricants and Specialty Products, and HEP. It primarily produces high-value light products, such as gasoline, diesel and jet fuel, and specialty lubricant products, as well as specialty and modified asphalt. The company offers its products to other refiners, convenience store chains, independent marketers, retailers, truck stop chains, wholesalers, railroads, governmental entities, and paving contractors or manufacturers, as well as for commercial airline use. It owns and operates 5 refineries with a combined crude oil processing capacity of approximately 457,000 barrels per day in El Dorado, Kansas; Tulsa, Oklahoma; Artesia, New Mexico; Cheyenne, Wyoming; and Woods Cross, Utah. The company also owns and operates vacuum distillation and other facilities in Lovington, New Mexico, as well as asphalt terminals in Arizona, New Mexico, and Oklahoma. Its refineries serve markets in the Mid-Continent, Southwest, and Rocky Mountain regions of the United States. In addition, HollyFrontier Corporation produces base oils and other specialized lubricant products; and owns and operates logistic assets consisting of petroleum product and crude oil pipelines, terminals, tankage, loading rack facilities, and refinery processing units. The company was formerly known as Holly Corporation and changed its name to HollyFrontier Corporation as a result of its merger with Frontier Oil Corporation in July 2011. HollyFrontier Corporation was founded in 1947 and is headquartered in Dallas, Texas. 


      Company Analysis and Financial Data Status

      All financial data provided by Standard & Poor's Capital IQ.
      DataLast Updated (UTC time)
      Company Analysis2020/01/25 23:41
      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.