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Student's signature (name typed here is equivalent to a signature): Eloy Cano
Analyzing HollyFrontier Corp.
October 29, 2012
Timothy J. Leyes
Analyzing HollyFrontier Corp.
HollyFrontier is a company that deals in the refining of petroleum including gasoline and other petroleum products. According to “CNN Money” (2012), the company sits in 170th place in the fortune 500 companies. (Fortune 500) As a potential investor and mutual fund manager it would be my responsibility to make sure that this investment is in the best interest of the fund. I would have to take into consideration the strengths, weaknesses, opportunities, and threats to the company. Once identified, I can make a better decision on whether to invest in the company or not and why. If the decision is made to invest, we have to decide what direction we would like the company to take and what to be careful for in the future in order to protect our investment. Strengths
Some of the strengths I identified from this company are in its diversity of products offered and its strong refining operations. The company operates five refineries namely, Tulsa, El Dorado, Navajo, Cheyenne, and Wood Cross, with a total annual average crude oil capacity of approximately 443,000 bpd. The El Dorado refinery can select from many different types of crude oil because of its direct access to Cushing, Oklahoma, which is connected by pipelines to west Texas, the Gulf Coast, and to Canada. This access, combined with the El Dorado refinery's complexity, gives it the flexibility to refine a wide variety of crude oils HollyFrontier’s refineries produce high value light products such as gasoline, diesel fuel, jet fuel, specialty lubricant products, and specialty and modified asphalt. (Company Profile: Hollyfrontier Corporation, 2012). With this level of operations it holds strong productivity potential which would be very positive to any new clients that may be interested. Furthermore, the diversity allows for the company to adapt to changing conditions and demand. The company has also shown great progress financially. It has nearly tripled its profits from 2011. According to Hollyfrontier (2012) “HollyFrontier Corporation (NYSE-HFC) ("HollyFrontier" or the "Company") today reported first quarter net income attributable to HollyFrontier stockholders of $241.7 million or $1.16 per diluted share for the quarter ended March 31, 2012, compared to $84.7 million or $0.79 per diluted share for the quarter ended March 31, 2011.”Good profitability increases year to year make a huge difference to investors as it means the company is capable of making money. These are areas in which the company is strong and are specifically appealing to stockholders because it shows this company has a positive outlook for the future. Weaknesses
The company, like most others, also has weaknesses and these have to be carefully studied as well. It is important to study these carefully because there may be one weakness that could...