Strong crude pricing could set up refiner buying opportunity, Cowen says

The refining analysts at Cowen say that although Q2 earnings estimates are coming down and Q3 also could prove challenging, they believe asset quality will be rewarded and see higher crude prices as setting up a buying opportunity in their five favorite sector names.

Topping the list is Marathon Petroleum (MPC), which Cowen rates at Outperform with a $120 price target; the firm's other favorites are PBF, TSO, VLO and WNR.

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Comments (4)
  • Investing Crunch
    , contributor
    Comments (53) | Send Message
    Valero is headed higher too. Valero has great asset quality and is trading at a discount to its peers.
    12 Jun 2014, 11:28 AM Reply Like
  • osooro
    , contributor
    Comments (87) | Send Message
    Valero is the refiner powerhouse. I remember when Clinton was running against Bush in 1994, and he said to himself, "It's the economy stupid!" Like Clinton, I'm telling myself " It's energy, stupid."
    12 Jun 2014, 11:56 AM Reply Like
  • dfsmshsm
    , contributor
    Comments (47) | Send Message
    "Setting up a buying opportunity." What does this mean? If the rise in WTI is significant, but temporary, would the price of these refiners decline, and that is the buying opportunity, on the assumption that WTI would go back down, thus increasing the price differential between WTI and Brent and eventually taking the refiners back to current levels of profitability? Is there another interpretation someone would care to offer? Does this mean now is the time to sell these refiners on the assumption that in the near future their prices will decline?
    13 Jun 2014, 07:02 PM Reply Like
    , contributor
    Comments (6334) | Send Message
    MPC is way oversold.


    Back up the truck while you can, they're Goldman Sachs favorite too.


    13 Jun 2014, 07:09 PM Reply Like
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