Refining Operations - HollyFrontier aims to operate its refineries at a crude charge rate of 450,000 to 470,000 barrels per day[37] - HollyFrontier targets mid-cycle Refining EBITDA of $1.0 billion to $1.2 billion per year[132] - HollyFrontier is implementing cost-saving initiatives to achieve a target operating expense of $5.50 per throughput barrel[40] - HollyFrontier has increased its refining capacity by 15% since 2015[27] Holly Energy Partners (HEP) - HollyFrontier owns 59% of the LP Interest in HEP[15] - Over 80% of HEP's revenues are tied to long-term contracts and minimum volume commitments[15, 62] - HEP is targeting a distribution coverage ratio of 1.0 to 1.2x[62] Lubricants & Specialty Products - HollyFrontier Lubricants & Specialty Products (HF LSP) is the largest North American group III base oil producer[15] - HF LSP's Rack Forward business consistently generates EBITDA margins of 10-15%[114] - HF LSP targets Rack Forward EBITDA of $175 million to $200 million in 2018[135] Financials & Valuation - HollyFrontier's sum-of-the-parts valuation estimates a total share price of $60, based on a $37 valuation for Refining & Marketing, $12 for Holly Energy Partners, and $11 for Lubricants & Specialty Products[129] - HollyFrontier targets a net debt to EBITDA ratio of 1x (excluding HEP)[141]

Core Viewpoint - The article emphasizes the importance of value investing and highlights HF Sinclair (DINO) as a strong value stock based on its financial metrics and rankings [2][3][6] Company Analysis - HF Sinclair (DINO) currently holds a Zacks Rank of 2 (Buy) and a Value grade of A, indicating it is among the best value stocks available [3] - The company's price-to-book (P/B) ratio is 0.9, which is significantly lower than the industry average of 1.81, suggesting that DINO is undervalued [4] - DINO's P/B ratio has fluctuated over the past year, reaching a high of 1.02 and a low of 0.53, with a median of 0.76 [4] - The price-to-sales (P/S) ratio for DINO is 0.3, compared to the industry's average P/S of 0.37, further indicating its undervaluation [5] - The combination of DINO's strong earnings outlook and favorable valuation metrics supports its classification as an impressive value stock [6]

Acquisition Overview - HollyFrontier Corporation (HFC) is acquiring Sonneborn for $655 million [7], which is 7x EBITDA multiple net of working capital and synergies [8] - The purchase price net of approximately $72 million in working capital is $583 million [10] - The transaction is expected to close in 2019 and is expected to generate approximately $85 million of annual EBITDA, including synergies [10] - The acquisition is expected to be immediately accretive to earnings and cash flow per share [10] Synergies and Financial Impact - HollyFrontier expects to capture approximately $20 million in annual synergies [10] - The synergies are expected to come from SG&A ($5 million), Logistics ($3 million), and Operations ($12 million) [36] - Pro forma EPS accretion is estimated at 30% in 2015, 157% in 2016, 69% in 2017, and 33% in the trailing twelve months ending July 31, 2018 [38] Assets and Operations - Sonneborn has a differentiated specialty products portfolio, including Petrolatums, White Oils, Microcrystalline Waxes, Natural Sodium Sulfonates, and Industrial Specialties [11, 16] - Sonneborn has a 3,300 barrel per day processing capacity in Petrolia, Pennsylvania [16] - Sonneborn has a 2,000 barrel per day combined processing capacity in the Netherlands [16] Market Positioning - 100% of Sonneborn earnings are attributable to the Rack Forward segment [19] - The acquisition shifts HollyFrontier's product mix towards finished products, with finished products representing 63% of the pro forma product slate by volume [28] - Pro forma sales are expected to be approximately $20 billion [28]