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Andeavor’s Decent Growth Expectations for the Second Quarter

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Dec. 4 2020, Updated 10:53 a.m. ET

The series so far

We began this series by ranking the growth in refiners’ second-quarter earnings. In the preceding two parts, we looked at the two highest probable growth achievers for Q2 2018, Phillips 66 (PSX) and Marathon Petroleum (MPC). PSX and MPC are expected to post 101% higher year-over-year or YoY growth and 97% higher YoY EPS in Q2 2018. In this part, we’ll look at the third stock, Andeavor (ANDV).

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Andeavor’s Q2 2018 estimates

In Q2 2018, per Wall Street analysts’ estimates, ANDV is expected to post EPS of $3.0, which is 70% higher than its Q2 2017 adjusted EPS and around 358% lower than its Q1 2018 adjusted EPS. ANDV’s revenues are expected to be around $12.2 billion in Q2 2018, which is around 55% higher than the Q2 2017 revenues.

In Q2 2018, Andeavor’s refining index values, which are regional crack indicators, have risen year-over-year in two of the three areas.

Index values, yearly, have put up a mixed trend. Index values in California declined by $1.7 per barrel yearly to $13.2 per barrel in the second quarter. However, index values in the Pacific-Northwest and Midcontinent rose by $4.3 per barrel yearly and $6.9 per barrel, respectively, to $15.9 per barrel and $22.3 per barrel, respectively, in Q2 2018. Andeavor’s consolidated index increased from $14.6 per barrel in Q2 2017 to $17.1 per barrel in Q2 2018, pointing toward a likely rise in ANDV’s refining margin in Q2 2018 over Q2 2017.

In the next part of this series, we’ll review the last stock under consideration, Valero Energy (VLO).

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