HF Sinclair(US:DINO) Zhi Tong Cai Jing·2025-10-13 08:33Core Viewpoint - Morgan Stanley has upgraded its earnings forecast for HF Sinclair Corp for Q3 2025, citing improved refining margins and throughput post-maintenance, leading to better-than-expected overall profitability [1] Refining Business - Morgan Stanley predicts a 5% quarter-over-quarter increase in the benchmark crack spread, with total throughput estimated at 675 kbpd, close to market consensus of 677 kbpd [2] - The refining segment's EBITDA is expected to be approximately $531 million, exceeding market consensus of $505 million and up from about $476 million in Q2 [2] - The forecasted refining gross margin is around $16.68 per barrel, compared to the market consensus of $16.06 per barrel, with a capture rate expected at 59%, down from 67% in Q2 [2] Lubricants & Specialties - Post-maintenance sales recovery and improved market conditions are anticipated for the Lubricants & Specialties segment, with an expected EBITDA of about $79 million, close to the market consensus of $81 million and significantly higher than $55 million in Q2 [2] Renewables Business - The Renewables segment is expected to see a decline in benchmark profit margins, with EBITDA losses projected at $11 million, worse than the market consensus of a $9 million loss [3] Midstream and Marketing - The Midstream segment's EBITDA is expected to remain stable at around $113 million, in line with market expectations [3] - The Marketing segment is projected to have an EBITDA of approximately $24 million, slightly below the market consensus of $26 million [3] Full-Year and Mid-Term Outlook - For 2025, Morgan Stanley's adjusted EBITDA forecast is $1.975 billion, a 2% increase from previous estimates, with operating EPS expected at $3.82, up 6% from earlier predictions [4] - Free cash flow for 2025 is projected at $941 million, a 4% increase from prior estimates [4] - The company is expected to improve its net debt and capital structure, with a dividend yield range of 3.8% to 5.7% depending on the year [4] Stock Performance - Despite low international oil prices, HF Sinclair's stock has surged, primarily due to improved refining margins and diversified business operations, with a year-to-date stock price increase of 50% [5] - The company's stock price currently hovers around $50.59, significantly outperforming the S&P 500 index [5] Company Overview - HF Sinclair operates as an independent energy company with refining capabilities of approximately 678,000 barrels per day, alongside lubricants and renewable fuel production [6] - The company's profitability is closely tied to the crack spread rather than crude oil prices, allowing for potential profit increases even in a declining oil price environment [6]