HF Sinclair stock downgraded to Underperform by Wolfe Research

Published 14/07/2025, 18:12
HF Sinclair stock downgraded to Underperform by Wolfe Research

Investing.com - Wolfe Research downgraded HF Sinclair (NYSE:DINO) from Peerperform to Underperform on Monday, setting a price target of $42.00. According to InvestingPro data, the stock’s technical indicators align with this cautious stance, as the RSI suggests the stock is in overbought territory.

The downgrade comes after HF Sinclair outperformed the S&P by 29% year-to-date, with shares rebounding 74% from recent lows, pushing the stock above what Wolfe Research considers fair value.

The move is part of Wolfe Research’s broader downgrade of the U.S. refining sector from Overweight to Market Weight, despite the sector experiencing a strong margin recovery that largely met the firm’s expectations.

Wolfe Research cited concerns about greater forward seasonal volatility in free cash flow from HF Sinclair’s Rockies and Mid-Continent asset base, along with the impact of tighter crude spreads on the company’s performance.

The research firm indicated that further upside would require confidence in another upward reset in mid-cycle margins, which they believe lacks the visibility that characterized the post-COVID "Regional Golden Age" of 2022-23.

In other recent news, HF Sinclair has seen several notable developments. The company has reported strong earnings expectations for the upcoming quarters, with Piper Sandler forecasting second-quarter earnings per share (EPS) of $1.19, significantly above the consensus estimate of $0.95. Barclays (LON:BARC) also raised its price target for HF Sinclair to $43, citing an improved profitability outlook for refining. Meanwhile, Mizuho (NYSE:MFG) upgraded HF Sinclair’s rating to Outperform and set a new price target of $47, highlighting favorable refining fundamentals and potential benefits from structural undersupply in U.S. natural gas.

Morgan Stanley (NYSE:MS) maintained an Overweight rating on HF Sinclair, projecting second-quarter EPS of $1.02, slightly above the consensus. In addition to these financial forecasts, HF Sinclair has dual-listed its common stock on NYSE Texas, maintaining its primary listing on the New York Stock Exchange. Piper Sandler also emphasized the potential for accelerated share buybacks in the second half of 2025, driven by a strong financial outlook. Despite these positive indicators, some analysts have noted challenges in the company’s Renewables segment, which could impact earnings.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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