Refiners Are Still Riding High
Wall Street seems to be betting that another year of calamities will produce more record profits for refiners.
Last year's hurricanes, which pushed gasoline prices above $3 a gallon after a big chunk of U.S. refining capacity was disabled, helped make 2005 a record year for the refining industry. Share prices of independent refiners more than doubled as a group, compared with about 27% for the energy industry as a whole.
Wall Street saw the good times continuing for refiners in 2006. But in the past month, high fuel inventories and relatively soft consumer demand have pushed down prices of gasoline, heating oil and other refined products, resulting in a steep drop in operating margins for refiners. Consequently, Wall Street analysts have reduced their earnings estimates for virtually all the refiners, and their stock prices have fallen.
Yet the share prices might not have fallen far enough. Many are still trading at above year-end 2005 prices, when they were coming off a record year with some of the highest refining margins ever. By contrast, the share prices of most of the top integrated oil majors have dropped much more sharply, to pre-Hurricane Katrina levels. The question is whether the refiners merit a price premium.
Some Wall Street analysts seem to think so. Even with their reduced forecasts, they are still projecting that refiners will improve earnings over 2005. Credit Suisse Securities reduced its 2006 earnings forecast for Tesoro, based in San Antonio, by 17% to $7.84 a share. And Friedman, Billings, Ramsey cut its estimate for Dallas-based Holly to $5.85 a share from $6.50. But the new estimates still exceed impressive results last year, when Tesoro earned $7.19 a share and Holly earned $5.28 a share.
The possibility of a third year of hurricane damage to Gulf of Mexico refineries is one reason why analysts like refiner stocks. Another is an expectation that consumer demand will pick up. Profit margins per barrel already have recovered a bit from their lows this year. But analysts also are raising the prospect of supply disruptions resulting from two major changes this year in fuel blends.
Last year's energy bill means that many refiners will stop adding methyl tertiary butyl ether to gasoline. That poses a potential supply problem since the U.S. relies heavily on gasoline imported from Europe, where MTBE will continue to be widely used.
They predict additional possible turmoil when, on June 1, a law goes into effect requiring a sharp reduction in the sulfur content of diesel. Analysts say supplies will tighten in the beginning when sulfur residue remaining in pipelines and tankers from other fuels can contaminate the lower-sulfur diesel and raise its content beyond the legally permissible level.
But the situation could just as easily go the other way. George Littell, a partner in Houston-based energy consulting firm Groppe Long & Littell, discounts any major supply disruption. "There has been some lead time" for the industry to adjust to the new MTBE situation, for example, says Mr. Littell, who doesn't own any refining shares.
Even in a bearish scenario, the sector should still produce healthy returns. Refiners aren't scheduled to bring significant increases in capacity on line until 2009. And standouts such as Houston-based Frontier Oil and Valero Energy of San Antonio, which have plenty of capacity to refine heavy crude oil -- where refining margins are the widest -- could beat last year's numbers even without turmoil in the supply chain. Jacques Rousseau, a Friedman Billings energy analyst who has a "buy" rating on Frontier's shares, says he has been promoting the company's stock because its Cheyenne, Wyo., refinery can process relatively cheap heavy Canadian crude, which can be sold for a high profit.
But Mark Flannery, managing director of Credit Suisse, who is among those predicting higher returns than last year for the refining industry as a whole, concedes "It will be hard to better last year without these disruptions coming through." Neither Mr. Rousseau nor Mr. Flannery own shares in the refining companies. Without being specific, Friedman Billings and Credit Suisse say one should assume that they provide investment-banking services for the companies their analysts cover.
Ben Tsocanos, an energy analyst with Standard & Poor's who doesn't own any shares in the refiners nor rate the stocks, says the key to whether 2006 beats 2005 is simple: It "depends on the hurricanes." He predicts a year closer to 2004 -- highly profitable, but not near the 2005 bonanza.
炼油类股又将迎来丰收年
看来华尔街正在押宝：今年又将是多灾多难的一年，而炼油企业的盈利也将因此再创辉煌。
去年的两场飓风造成美国炼油产能严重受损，推动汽油价格突破了每加仑3美元大关，并提振2005年炼油行业的盈利创出历史新高。总的来说，独立炼油商的股价上涨了一倍以上，而能源类股的总体涨幅仅有27%。
华尔街预计炼油商在2006年又将迎来一个好年景。但在过去1个月中，燃料库存高企和相对疲软的消费需求压低了汽油、取暖油和其他成品油的价格，进而导致炼油厂的运营利润率大幅下滑。
受此影响，华尔街分析师几乎调低了所有炼油商的利润预期，这些炼油类股的股价也随之下滑。
不过，炼油类股的回调可能还没有到头。许多炼油类股当前的股价仍高于去年年底时的水平，当时，一些炼油企业的利润率迎来了历史上的最好时期，整个行业的盈利状况也创下历史新高。相比之下，大型原油综合企业的股价大多急剧下挫，跌至卡特里娜飓风之前的水平。现在的问题是，这些炼油商股价中含有的溢价部分是否合理。
一些华尔街分析师给出的答案是肯定的。即便下调了预期，他们仍然认为炼油企业的盈利状况将好于2005年。Credit Suisse Securities把圣安东尼奥炼油商Tesoro 2006年的每股收益预期下调了17%，至7.84美元；Friedman, Billings, Ramsey把达拉斯炼油商Holly 2006年的每股收益预期从6.50美元下调至5.85美元，但仍高于二者去年每股7.19美元和5.28美元的业绩。
分析师看好炼油类股的原因之一是，墨西哥湾炼油厂仍有可能第三年遭到飓风的危害。另一个原因是，预计消费者需求将有所上升。
目前，炼油厂的单位利润率已脱离今年的低点。但分析师认为，由于今年在燃油配方方面出现的重大变化，发生供应中断的可能性加大了。
去年通过的能源法案意味著许多炼油厂将停止向汽油里添加甲基第三丁基醚(MTBE)。这有可能带来供应方面的问题，因为美国对从欧洲进口的汽油非常依赖，而MTBE在欧洲的使用非常普遍，而且这种情况还会继续下去。
分析师预计，到6月1日，要求大幅减少柴油含硫量的法规开始生效时，市场可能还会出现别的问题。
分析师说，开始时由于输油管道和油轮里其他燃油残存下来的硫成分可能会掺杂到低硫柴油里，导致硫含量超过法定允许范围，这种情况下供应可能会吃紧。
但也很有可能出现相反的情况。休斯顿能源咨询公司Groppe Long & Littell的合伙人乔治?利特尔(George Littell)认为，不会出现任何供应严重中断的情况。
他说，炼油业在达到有关MTBE的新规定之前有一定的调整期。他不持有炼油企业的股票。
即使从比较悲观的角度考虑，炼油类股仍应获得良好的回报。目前炼油厂尚无在2009年之前大幅增加产能的计划。
像休斯顿的Frontier Oil和圣安东尼奥的Valero Energy等重油加工能力较高的炼油企业，即便今年不出现意外情况，其收益仍有可能超过去年。
Friedman Billings分析师雅克?卢梭(Jacques Rousseau)对Frontier的评级是买进。他说，他一直很推崇该股，因为它在怀俄明州夏恩的炼油厂能处理价格相对低廉的加拿大重油，这样一来，其成品油的利润会比较高。
瑞士信贷(Credit Suisse)董事总经理马克?弗兰诺瑞(Mark Flannery)虽然也和其他一些人士一样预计炼油类股今年的总体回报将高于去年，但他认为，如果不发生供应中断的状况，要想超过去年将会很困难。
卢梭和弗兰诺瑞均不持有炼油类股。Friedman Billings和瑞士信贷说，人们可以假定他们为他们的分析师跟踪的公司提供投行服务，不过这两家机构对此均未作具体说明。
标准普尔(Standard & Poor's)能源分析师本?佐加诺斯(Ben Tsocanos)说，决定2006年炼油类股能否超过2005年的因素很简单，那就是看还会不会发生飓风。他预计，今年的情形可能比较接近2004年，盈利会很可观，但不太可能再有2005年那样的大好事。佐加诺斯不持有炼油类股票，也不从事股票评级。
