They took 30+ mill in hedging losses and 45-55 mill in EBITDA losses due to an outage in February. They are now 20% hedged going forward, but will not add new hedges this quarter, as they believe spreads will remain wide.
Their goal is to hedge a max of 25% at historic cracks and pay down debt.
My take: WNR was being conservative in Q1, but will take on more risk in Q2. The potential for a blowout quarter in Q2, due to their refineries operating at full capacity, no signs of demand destruction and potential sale of their Yorktown refinery, coupled with historically high spreads, seems likely. Although this company has disappointed in Q1, their reasons are rational and the stock is extraordinarily oversold and undervalued at current levels.
I will be adding to this position.
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Looks like they are buying the news, now. Back over $15.
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Seeing as how they SOLD on leaked news, why wouldn’t they buy when everyone else finds out the news?
they are
Thanks Fly,looking forward to ALJ’s number’s this afternoon.
WNR, poppin a woody!!!
and i’ll be just as stubborn. i knew it had to be debt. there isnt one refiner or any other oil company be it large or small that is NOT in heavy debt,on a revolving basis.its the nature in that business.but like anyone facing debt, its how you get out from underneath it that proves its salt. this is my third trip in wnr, in and out, i’ll hold the mother fucker till it comes back and then some…….its been shake out city for everything,so fuck it.
not that Im nearly as smart as Senor Fly…but thats what I got outof it as well. Adding now!!
Fly
they also mentioned an unrealized loss of 17 million on hedging too by the way. It was a little garbled in the way he mentioned it.
But it appear that if the fuckers didn’t hedge and there wasn’t the weather even their profits could ahve been stratospheric.
17 cents posted
60 cent loss in hedging
55 cents due to the February outage
Normalized earnings would have been 1.32!!! That’s fucking huge actually if one normalizes and the fuckers stop hedging shit all the time.
I sold may 15 calls against my positions, if im called away, i take less of a loss, if not, i keep the premiums and stay long at a lower cost. Hopefully this helps…
Unfortunately I sold at the low this morning.
oops should read
But it appears that if the fuckers didn’t hedge and there wasn’t the Feb outage their normalized profits could have been stratospheric
They are positioned for Q2 orgasms.
That has to be good!
In a gaping crack spread you mean? To make money babies?
Like the abused spouse of a wifebeater, we go back for more.
Phunny
OMG I have life again, challenge now is managing May and June option positions to recapture loss and book gains. hmmmmm.
I get the idea WNR is a much longer term play. They had some bad luck, some was weather, some was outages, extra maintenance to do. Now they are good to run for a while. But they have a lot of high cost debt to pay down with a window in Dec. to do so. So they are getting their business in order, and doing a good job. But it’s gonna be a boring sun of a bitch for a year or two while this shit comes around.
I’m adding a little to WNR. Agriculture chemicals are finally bouncing hard, which greatly pleases me as I am no longer tap dancing in flint rock caves covered in gunpowder.
Know that tune, my FOSL’s been your POT (sortta).
And it even went green today.
The Fly always wins, even when he appears to be losing, badly.
Parts of me are feeling better, but I still can’t sit down!
Took off the put leg of my hedge at 15.35. I think we go to at least 17 on this bounce. 14 was a good support level.
Wow, after an ugly start to the day things are actually up slightly at this point. Money was made. Hell, money is always being made it is just a matter of who is pocketing it.