Comparing HollyFrontier stock with peers
This quarter (started April 1), HollyFrontier (HFC) stock has fallen 18%, while the SPDR S&P 500 ETF (SPY) has risen 2%. Peers Marathon Petroleum (MPC) and PBF Energy (PBF) have fallen 20% and 23%, respectively, and Valero Energy (VLO) and Phillips 66 (PSX) have both fallen 10%.
HollyFrontier stock falls
HollyFrontier’s first-quarter results were weak, with its adjusted EBITDA falling 11% YoY (year-over-year) to $282 million. Its lower Refining and Lubricants & Specialty Products earnings were offset by higher midstream earnings.
This quarter, oil spreads have narrowed, pointing at weaker refining conditions for HFC. The WTI-WCS (West Texas Intermediate–Western Canadian Select) spread has contracted by 31% YoY to $12.30 per barrel, driven by supply constraints. Also, the WTI Cushing-WTI Midland spread has narrowed by 67% YoY to $2.60 per barrel due to new pipelines starting operations sooner than expected—they have eased infrastructure issues and allowed crude to be transported out of the Permian region.
However, index values and refining cracks in HollyFrontier’s vital operational areas—the Midcon, Rockies, and Southwest regions—have expanded this quarter, which could support HFC’s refining margin.
HollyFrontier stock’s decline is likely due to the company’s weaker first-quarter earnings and oil spreads narrowing during the second quarter. However, index values and refining cracks in some regions have supported the stock.