-- CFRA, an independent research provider, has providedwith the following research alert. Analysts at CFRA have summarized their opinion as follows:
We raise our 12-month target price by $59 to $289, reflecting a combination of relative valuation and DCF model analyses. On a relative basis, we apply an 8.2x multiple of enterprise value to projected 2027 EBITDA, above peers. We argue for a premium valuation on the basis if superior return on invested capital (about 17% above that of independent refining peers). On this basis, we get a value of $275 per share. Meanwhile, our DCF model, using free cash flow growth of 4.2% per year for 10 years, 2.5% thereafter, yields a value of $303 per share. We raise our 2026 EPS estimate by $14.86 to $27.85 and 2027's by $6.42 to $19.65. Refining margins are likely to surge higher in Q2 as constrained volumes in the Persian Gulf help widen the gap between Brent and WTI crude (normally $4/b, that gap currently sits at $8/b), and we see possibility of this situation persisting in future quarters as well. VLO maximized its jet fuel production in March, which makes sense to us given market scarcity.