HollyFrontier Corp (HFC): Today's Featured Basic Materials Laggard

Editor's Note: TheStreet ratings do not represent the views of TheStreet's staff or its contributors. Ratings are established by computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model.

HollyFrontier ( HFC) pushed the Basic Materials sector lower today making it today's featured Basic Materials laggard. The sector as a whole closed the day up 0.3%. By the end of trading, HollyFrontier fell $1.53 (-2.7%) to $54.56 on average volume. Throughout the day, 4.4 million shares of HollyFrontier exchanged hands as compared to its average daily volume of 3.2 million shares. The stock ranged in price between $54.22-$55.94 after having opened the day at $55.59 as compared to the previous trading day's close of $56.09. Other companies within the Basic Materials sector that declined today were: Prospect Global Resources ( PGRX), down 12.6%, Torch Energy Royalty ( TRU), down 12.2%, Nevsun Resources ( NSU), down 11.2%, and GeoPetro Resources Company ( GPR), down 10.6%.
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HollyFrontier Corporation operates as an independent petroleum refiner and marketer in the United States. It produces light products, such as gasoline, diesel fuel, jet fuel, specialty lubricant products, liquefied petroleum gas, fuel oil, and specialty and modified asphalt. HollyFrontier has a market cap of $11.57 billion and is part of the energy industry. The company has a P/E ratio of 6.8, below the S&P 500 P/E ratio of 17.7. Shares are up 20.5% year to date as of the close of trading on Friday. Currently there are nine analysts that rate HollyFrontier a buy, no analysts rate it a sell, and five rate it a hold.

TheStreet Ratings rates HollyFrontier as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance, compelling growth in net income and attractive valuation levels. We feel these strengths outweigh the fact that the company shows low profit margins.

On the positive front, BMB Munai ( BMBM), up 32.2%, Oxford Resource Partners ( OXF), up 16.7%, L & L Energy ( LLEN), up 13.4%, and Ikonics Corporation ( IKNX), up 13.1%, were all gainers within the basic materials sector with Cheniere Energy ( LNG) being today's featured basic materials sector leader.

For investors not wanting singular stock exposure, ETFs may be of interest. Investors who are bullish on the basic materials sector could consider Materials Select Sector SPDR ( XLB) while those bearish on the basic materials sector could consider ProShares Short Basic Materials Fd ( SBM).

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