Contrasting CVR Refining (CVRR) and PBF Energy (PBF)

CVR Refining (NYSE: CVRR) and PBF Energy (NYSE:PBF) are both mid-cap energy companies, but which is the superior investment? We will compare the two companies based on the strength of their earnings, dividends, valuation, analyst recommendations, institutional ownership, risk and profitability.

Analyst Recommendations

This is a breakdown of current recommendations for CVR Refining and PBF Energy, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
CVR Refining 0 5 1 0 2.17
PBF Energy 3 6 5 0 2.14

CVR Refining currently has a consensus price target of $12.10, suggesting a potential downside of 25.31%. PBF Energy has a consensus price target of $29.25, suggesting a potential downside of 16.52%. Given PBF Energy’s higher possible upside, analysts clearly believe PBF Energy is more favorable than CVR Refining.

Profitability

This table compares CVR Refining and PBF Energy’s net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
CVR Refining 1.98% 7.90% 4.44%
PBF Energy 1.14% 2.35% 0.78%

Dividends

CVR Refining pays an annual dividend of $3.76 per share and has a dividend yield of 23.2%. PBF Energy pays an annual dividend of $1.20 per share and has a dividend yield of 3.4%. CVR Refining pays out 515.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. PBF Energy pays out 60.0% of its earnings in the form of a dividend.

Volatility & Risk

CVR Refining has a beta of 1.37, indicating that its share price is 37% more volatile than the S&P 500. Comparatively, PBF Energy has a beta of 1.45, indicating that its share price is 45% more volatile than the S&P 500.

Insider and Institutional Ownership

12.8% of CVR Refining shares are held by institutional investors. 2.6% of PBF Energy shares are held by insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a company is poised for long-term growth.

Earnings & Valuation

This table compares CVR Refining and PBF Energy’s revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
CVR Refining $4.43 billion 0.54 $15.30 million $0.73 22.19
PBF Energy $15.92 billion 0.24 $170.81 million $2.00 17.52

PBF Energy has higher revenue and earnings than CVR Refining. PBF Energy is trading at a lower price-to-earnings ratio than CVR Refining, indicating that it is currently the more affordable of the two stocks.

About CVR Refining

CVR Refining, LP is an independent downstream energy limited partnership with refining and related logistics assets that operates in the mid-continent region. The Company is a petroleum refiner. It owned and operated a complex full coking medium-sour crude oil refinery in Coffeyville, Kansas with a rated capacity of 115,000 barrels per calendar day (bpcd) and a complex crude oil refinery in Wynnewood, Oklahoma with a rated capacity of 70,000 bpcd capable of processing 20,000 bpcd of light sour crude oils (within its rated capacity of 70,000 bpcd), as of December 31, 2016. In addition, it also controlled and operated supporting logistics assets, including approximately 340 miles of active owned and leased pipelines, approximately 150 crude oil transports, a network of crude oil gathering tank farms, approximately 6.4 million barrels of owned and leased crude oil storage and over 4.5 million barrels of combined refined products and feedstocks storage capacity, as of December 31, 2016.

About PBF Energy

PBF Energy Inc. (PBF Energy) is a holding company. The Company is an independent petroleum refiner and supplier of unbranded transportation fuels, heating oil, petrochemical feedstocks, lubricants and other petroleum products in the United States. The Company operates through two segments: Refining and Logistics. It sells its products throughout the Northeast, Midwest, Gulf Coast and West Coast of the United States, as well as in other regions of the United States and Canada, and ships products to other international destinations. As of December 31, 2016, it owned and operated five domestic oil refineries and related assets. As of December 31, 2016, its refineries had a combined processing capacity, known as throughput, of approximately 900,000 barrels per day (bpd) and a weighted-average Nelson Complexity Index of approximately 12.2. As of December 31, 2016, the Company owned and operated five refineries providing geographic and market diversity.

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