HollyFrontier Corp. (HFC, Financial) announced Nov. 8 a regular quarterly dividend of 33 cents per share for the final quarter of 2017.
The dividend will be paid on Dec. 13 to shareholders of record as of Nov. 21. The ex-dividend date is Nov. 20.
If the U.S. refiner holds the quarterly dividend of 33 cents constant for the next three quarters, it will lead to a forward annual dividend of $1.32, for a yield of 3.12%.
The forward dividend yield of 3.12% is higher than the S&P 500's current dividend yield of 1.86%.
HollyFrontier is currently trading around $42.2 per share on the New York Stock Exchange. Year to date, the energy stock has gained 29%.
HollyFrontier is uptrending and the current share price is above the simple moving average computed over the past 50 and 200 trading days.
The average target price is $35.85 per share. This means analysts currently do not see room for a substantial increase in the market value of the stock. Instead, they see a 15% downside in the current share price.
Concerning earnings, HollyFrontier closed the third quarter of fiscal 2017 with a net profit of $272.01 million on $3.72 billion in revenue. The adjusted net profit was $202.4 million, or $1.14 per share.
For the fourth quarter and full-year 2017, analysts forecast EPS of 40 cents and $1.73. If the company meets quarterly earnings expectations, it will represent a positive turnaround from a loss of six cents reported in the prior-year quarter, while fiscal 2017 EPS will be 239.2% higher than previous year’s EPS.
Revenue is expected to come in at $3.03 billion for the fourth quarter. Total revenue for the year is projedted to be $12.9 billion.
For full fiscal 2018, analysts forecast EPS of $2.34.
HollyFrontier has a forward price-earnings (P/E) ratio of 18.03. When this is multiplied by a weighted (quarterly) average EPS of $2.16 for full fiscal years 2017 and 2018, it yields a value of $38.94 per share, which is below the current share price.
The energy stock looks overvalued by the market currently because it is trading only few cents below its 52-week high of $42.49 (the 52-week low is $23.46). According to the Peter Lynch chart below, HollyFrontier is trading above its earnings line:
GuruFocus ranked HollyFrontier's financial strength 6 of 10.
HollyFrontier has a market capitalization of $7.48 billion and an enterprise value of $9.7 billion. The oil refining company is trading at 1.54 times its book value, 22.21 times its trailing 12-month earnings and 0.56 times its trailing 12-months sales. The EV/EBITDA ratio is 8.90.
In the second quarter, John Buckingham (Trades, Portfolio) added 192,604 shares to his position, while Paul Tudor Jones (Trades, Portfolio) and Pioneer Investments (Trades, Portfolio) sold out.
Disclosure: I have no positions in HollyFrontier Corp.
