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PBF Energy: Earn A 13.6% Yield With This Deep Value Gem

Apr. 11, 2023 1:19 PM ETPBF Energy Inc. (PBF)16 Comments
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  • PBF Energy Inc. is attractively valued on both a "normalized" basis and a "current" basis.
  • The company has been a strong financial performer for years.
  • By selling put options, you can take ownership of PBF Energy stock at a 28% discount or earn a 13.6% annualized yield.

PBF Energy Refinery Close-up


Right now, PBF Energy Inc. (NYSE:PBF) offers investors a unique value proposition based on its track record of success, as well as its attractive valuation profile. With a long history of turning revenues into profits, in addition to a

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Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in PBF over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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Comments (16)

poppagasket profile picture
I hope PBF is buying up gobs of their shares with their stash of cash. Steal of a deal at these prices.
Covered puts work if you like the company enough to be a long-term holder but can live with missing out on capital gains in return for a nicer in the short term. Like any strategy it has trade-offs and depends on the investor's time horizon, risk tolerance and assessment of the company in question. To me the only space for argument should be around whether the company is attractive long-term.
PropNotes profile picture
@JefryLebowski Agreed - generally we look for high quality underlying companies that can produce a good yield or a good deal, and are situated in the right spot.

It never ends well; selling puts on low quality trash just for the yield.
Blackbox777 profile picture
So quiet. Can PBF buyback any shares at this time?
PropNotes profile picture
@Blackbox777 They continue to do so, although the pace may slow as crack spreads come in
They are in California man! Down she goes!
@OldManTobe Yes and the roads in Cali are more crowded all the time even with all the Teslas, gas prices are still high and PBF also has big markets on E. Coast and a 3 p/e should is not expensive, don't forget diesel biz which is huge,
Bulldog67 profile picture

Your statement that one can buy PBF at a 28% discount from the current price is very misleading. Seems you worked the example when PBF was about $43 a share. Anyone writing a naked put would be able to buy PBF only IF it sells down below $31 a share, which is very unlikely in today’s energy environment.

However, for the stock to drop that much, there will likely be very bad news for PBF to cause such weakness. So bottom line, you only will have the stock sold to you if it has a major downward move to below $31. Otherwise the current owner would sell the stock on the open market at higher prices.
@Bulldog67 u don’t get it. If the stock stays about $31 u collect $.75 for selling the put option and u don’t buy the stock. Hope that helps
PropNotes profile picture
@Bulldog67 Check the bullet points at the top of the article - "By selling put options, you can take ownership of PBF Energy stock at a 28% discount or earn a 13.6% annualized yield."


As in, there can be 2 outcomes - either you get a great deal, OR you get the cash yield.
Bulldog67 profile picture
@Hurricane of Gains Plus

I started dealing in options in the 90’s so I certainly “get it”!
I stand by my statement that the statement is very misleading!
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