UPDATE: Credit Suisse Downgrades PBF Energy (PBF) to Underperform
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Credit Suisse analyst Manav Gupta downgraded PBF Energy (NYSE: PBF) from Neutral to Underperform with a price target of $9.00 (from $17.00).
The analyst comments "PBF continues to operate a number of assets that are FCF negative. Our concern is that if PBF continues down this path then it would start running into liquidity issues by mid to late 2022. PBF’s net debt has gone from $1.25Bn at year-end 2019 to $3.2BN at end of 1Q 21. With cash burn, we have net debt going up to $3.9Bn by year-end 2021. We believe the right way to take part in the California energy market is AMTX, which is creating low carbons which create LCFS and RFS credits. While AMTX benefits as California strives to achieve carbon neutrality, PBF is the obligated party and it cost of compliance is only going up. We are downgrading PBF to Underperform, while recommending Outperform-rated AMTX."
Shares of PBF Energy closed at $9.57 yesterday.
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