10% Yield, 23% DCF Growth In 2019, More Growth Due In 2020: PBF Logistics LP

Feb. 15, 2020 9:15 AM ETPBF Energy Inc. (PBF)AMLP, XLE26 Comments


  • PBFX yields 9.94%, with 1.16X distribution coverage in Q4 '19.
  • DCF grew 22.82% and adjusted EBITDA grew 26.95% in 2019.
  • Management is guiding to ~21% EBITDA growth in 2020, which implies DCF growth of ~14.5%.
  • Distribution coverage should improve in 2020, as a result.
  • This idea was discussed in more depth with members of my private investing community, Hidden Dividend Stocks Plus. Get started today »


PBF Logistics LP (PBFX) owns, leases, acquires, develops, and operates crude oil and refined petroleum products terminals, pipelines, storage facilities, and other logistics assets. PBF Logistics GP LLC serves as the general partner of PBF Logistics LP. The company was founded in 2013 and is headquartered in Parsippany, N.J.

PBFX's assets serve its parent PBF Energy (NYSE:PBF), which is the fourth-largest US refiner by throughput capacity:

(Source: PBFX site)

In addition to growing via dropdowns from PBF, PBFX's management also has worked on organic internal growth projects, from which it expects to earn ~$95M during the next 4-5 years.

(Source: PBFX site)

Management also increased third-party revenue during the past few years, although its minimum volume commitments, MVC's, from PBF still contribute the overwhelming majority of its revenues:

Parent PBF Earnings:

Parent PBF reported earnings this week. Adjusted EBITDA for Q4 2019 was $272M, and $872M for full-year 2019, lower than 2018, mainly due to non-cash LCM inventory adjustments. LCM is a GAAP requirement related to inventory valuation that mandates inventory to be stated at the lower of cost or market. PBF's inventories are stated at the lower of cost or market.

(Source: PBF site)

PBF had a net debt/capitalization ratio of 25%, as of 12/31/19, slightly better than its 27% figure for 12/31/2018:

(Source: PBF site)

2019 PBFX Earnings:

PBFX also just reported Q4 '19 earnings this week, with good growth: Adjusted EBITDA and DCF grew 32%.

"For the year-ended December 31, 2019, the Partnership reported net income attributable to the limited partners of $100.3 million, or $1.71 per common unit, generated cash from operations of $149.0 million, EBITDA attributable to PBFX of $184.8 million, Adjusted EBITDA of $201.0 million and distributable cash flow of $137.1 million.

Included in reported results for the year-ended December 31, 2019 are $16.2 million, or $0.28

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