Is Par Pacific Holdings (PARR) A Bargain On Strong Q2 Earnings And Hawaii Guidance?
Why Par Pacific Holdings is back on watch after Q2 earnings
Par Pacific Holdings (PARR) moved into focus after its 4 August earnings release, which showed higher year over year sales and net income, along with guidance for a Hawaii refinery turnaround affecting third quarter throughput and capture.
See our latest analysis for Par Pacific Holdings.
The recent 1-day share price return of 8.12% took Par Pacific Holdings to $71.67, even after a 7-day share price decline of 13.52%. The year to date share price return of 100.08% and 1-year total shareholder return of 163.20% show strong longer term momentum that the latest earnings and Hawaii turnaround guidance are now testing.
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Bulls view Par Pacific Holdings as mispriced after strong Q2 earnings and a pullback from recent highs. Bears highlight Hawaii turnaround risks and already strong 1-year returns. Which case does the current valuation appear to support next?
Most Popular Narrative: 11.4% Undervalued
The most followed narrative currently pegs Par Pacific Holdings fair value at $80.86, compared with the latest close at $71.67, which frames the recent pullback in a different light.
The analysts have a consensus price target of $80.86 for Par Pacific Holdings based on their expectations of its future earnings growth, profit margins and other risk factors. However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of $100.0, and the most bearish reporting a price target of just $65.0.
Want to see what sits behind that fair value gap? The core story hinges on shifting revenue expectations, improving margins, and a future earnings multiple below the wider oil and gas sector. Curious how those moving parts combine into one number?
Result: Fair Value of $80.86 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the Par Pacific Holdings story also hinges on aging refinery assets and heavy exposure to Hawaii and Western US markets, where outages or regulatory shifts could quickly pressure margins.
Find out about the key risks to this Par Pacific Holdings narrative.
Next Steps
Does the mixed mood around Par Pacific Holdings reflect your own view, or does it feel off? Act quickly and test that by reviewing the 3 key rewards and 1 important warning sign
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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