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Why PBF Energy (PBF) Might be Well Poised for a Surge

Zacks Equity Research
·2-min read

Investors might want to bet on PBF Energy (PBF), as earnings estimates for this company have been showing solid improvement lately. The stock has already gained solid short-term price momentum, and this trend might continue with its still improving earnings outlook.

Analysts' growing optimism on the earnings prospects of this refiner is driving estimates higher, which should get reflected in its stock price. After all, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements. Our stock rating tool -- the Zacks Rank -- is principally built on this insight.

The five-grade Zacks Rank system, which ranges from a Zacks Rank #1 (Strong Buy) to a Zacks Rank #5 (Strong Sell), has an impressive externally-audited track record of outperformance, with Zacks #1 Ranked stocks generating an average annual return of +25% since 2008.

Consensus earnings estimates for the next quarter and full year have moved considerably higher for PBF Energy, as there has been strong agreement among the covering analysts in raising estimates.

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The chart below shows the evolution of forward 12-month Zacks Consensus EPS estimate:

12 Month EPS

Current-Quarter Estimate Revisions

The company is expected to earn $6.16 per share for the current quarter, which represents a year-over-year change of +5033.33%.

The Zacks Consensus Estimate for PBF Energy has increased 9.35% over the last 30 days, as four estimates have gone higher compared to no negative revisions.

Current-Year Estimate Revisions

For the full year, the company is expected to earn $20.69 per share, representing a year-over-year change of +927.6%.

There has been an encouraging trend in estimate revisions for the current year as well. Over the past month, four estimates have moved up for PBF Energy versus no negative revisions. This has pushed the consensus estimate 7.16% higher.

Favorable Zacks Rank

The promising estimate revisions have helped PBF Energy earn a Zacks Rank #1 (Strong Buy). The Zacks Rank is a tried-and-tested rating tool that helps investors effectively harness the power of earnings estimate revisions and make the right investment decision. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Our research shows that stocks with Zacks Rank #1 (Strong Buy) and 2 (Buy) significantly outperform the S&P 500.

Bottom Line

While strong estimate revisions for PBF Energy have attracted decent investments and pushed the stock 8.3% higher over the past four weeks, further upside may still be left in the stock. So, you may consider adding it to your portfolio right away.


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Zacks Investment Research