Piper Sandler cuts PT on US refiners

Delek US Holdings

20/09/2024 13:25

** Brokerage Piper Sandler cuts price targets on several
U.S. refiners due to incremental refined product capacity and
weaker-than-expected demand in 2025
    ** Brokerage lowers its FY25 refining margin outlook, now
expects NYH 3-2-1 crack spread of $15.80/bbl
    ** Piper Sandler also cuts 3Q24 and FY24 EPS estimates by
232% and 57%, respectively, and FY25 estimates by 52%; adds that
it expects significant negative revisions into third-quarter
results
    ** Piper Sandler says the supply-demand balance has
deteriorated into 2025, driven by a combination of lower demand
estimates and higher supply; expects supply-demand balance to be
roughly flat in 2025 compared to 2024
    ** "We anticipate ~1.5 million barrels per day of gross
capacity additions in 2025...continued weakness in both OECD
(Organization of Economic Cooperation and Development) and
Chinese distillate demand suggests downside risk to our
estimates"
    ** Here are the PT cuts made by the brokerage
    
 Company     New PT      Old PT      Rating
 HF          $49         $58         Overweight
 Sinclair                            
  DINO.N                             
 Delek US    $19         $25         Neutral
 Holdings                            
  DK.N                               
 PBF Energy  $25         $47         Underweigh
  PBF.N                              t
 Phillips    $136        $151        Overweight
 66  PSX.N                           
 Valero      $123        $169        Neutral
 Energy                              
  VLO.N                              
 Marathon    $145        $168        Neutral
 Petroleum                           
  MPC.N                              
 
 (Reporting by Vallari Srivastava in Bengaluru)
 ((Srivastava.Vallari@thomsonreuters.com;))