Downstream Companies Are near 52-Week Lows: What Do Analysts Think?

The downstream companies shown in the following table are about 6% above their 52-week lows. Wall Street analysts’ consensus estimate suggests a 52% upside for these US-based (SPXL) downstream companies on average. Phillips 66, Valero Energy (VLO), Marathon Petroleum (MPC), and Tesoro (TSO) could rise by 18%, 36%, 78%, and 50%, respectively, from their current levels. Compared to the estimate on February 12, the target prices for Phillips 66, Valero Energy, and Tesoro fell from $93, $81, and $114 to $92, $78, and $113.

In comparison, Delek US Holdings, Alon USA Energy, and CVR Refining could rise by 130%, 51%, and 34.3%, respectively. Regarding the current and forward price-to-earnings ratios, Delek US Holdings, CVR Refining, and HollyFrontier are relatively cheaper than other downstream companies.

The large-cap downstream companies in the above chart are trading at an average of 26% below their respective 100-day moving averages.

Delek US Holdings (DK) and CVR Refining (CVRR) are currently trading 44% and 43% below their respective 100-day moving averages—the highest among the group. Phillips 66 (PSX) and Northern Tier Energy (NTI) are trading 6% and 11% below their respective 100-day moving averages—the lowest among the group.

In the next part of the series, we’ll discuss the moving averages and analysts’ estimates for large-cap midstream companies.