HF Sinclair Stock: Buy, Hold, or Take Profits After Q3 Earnings?

On Oct. 30, HF Sinclair Corporation DINO announced third-quarter 2025 earnings that exceeded expectations. Soft input prices and favorable demand for refined petroleum products are making the energy player’s business outlook bright. However, before coming to the investment conclusions, we need to analyze HF Sinclair’s business fundamentals.

HF Sinclair’s Q3 Earnings Snapshot

DINO reported third-quarter earnings per share of $2.44, which beat the Zacks Consensus Estimate of $1.94.

Total quarterly revenues of $7.3 billion outpaced the Zacks Consensus Estimate of $7 billion. The top line also increased from the year-ago figure of $7.2 billion.

PBF Energy Inc. PBF and Valero Energy Corporation VLO are two other leading refining companies. Both PBF and VLO have already reported quarterly results.

Soft Oil Prices to Aid HF Sinclair’s Refining Business

Per data from the U.S. Energy Information Administration (“EIA”), the West Texas Intermediate spot average prices for 2025 and 2026 will be $65 per barrel and $48.50 per barrel, respectively, suggesting a considerable decline from $76.60 per barrel in 2024. Rising oil inventories across the globe are hurting the commodity prices, EIA added.

This is a positive development for HF Sinclair’s refining business, since it purchases raw crude to produce refined petroleum products. Notably, DINO can process 678,000 barrels of crude oil daily.

On top of that, HF Sinclair expects refining fundamentals to be highly favorable through 2026, thanks to rising demand for distillates and limited new capacity.

DINO’s Healthy Balance Sheet & Strategic Midstream Expansion

DINO has a strong balance sheet as reflected in the debt-to-capitalization of only 22.6%, lower than the 37.67% of the composite stocks belonging to the industry. Thus, the energy player can rely on its sturdy balance sheet to sail through an uncertain business environment. PBF & VLO have debt-to-capitalization ratios of 31.1% and 28.35%, respectively.

Investors should also note that HF Sinclair is aiming to expand its existing pipelines to transport up to 150,000 barrels of fuel every day to Western markets of the United States, like Nevada and California.

Should Investors Bet on the Stock?

The positive developments are reflected in the price chart of the stock. Year to date, DINO has surged 57.4%, outperforming the industry’s 21.1% growth. PBF Energy and Valero Energy both underperformed DINO, gaining 38% and 42.3%, respectively, over the same time frame.

Considering the valuation story, investors are willing to pay a premium price for DINO. This is reflected by the fact that it trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 6.45X, which is above the broader industry average of 4.37X.

Considering the backdrop, investors should bet on the stock right away, even at the premium price. DINO currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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