Getting crude oil from the ground into gas for our fuel tanks is more complicated than we imagine:
- Oil should be stored.
- Refined oil (such as gasoline) travels through pipelines to terminals.
- It is then loaded onto trucks and taken to local gas stations.
And oil transportation is a profitable business.
The U.S. Census Bureau estimates that crude oil pipeline revenues will be increased by 21.3% from 2020 to 2024
Today, Power Stock is a key player in the production and transportation of crude oil in the United States: PBF Logistics LP (NYSE: PBFX).
Some companies sell crude oil, but without PBFX there is no way to store or transport it.
The company owns storage tanks, pipelines and terminals throughout the United States
Shares of New Jersey-based PBF Logistics LP have been given a Strong Outperform rating. 94 out of 100 in our stock power rating system. We expect it to beat the broader market 3 times in the next 12 months.
PBFX Stock: Great Momentum + High Quality
PBF Logistics had a solid second quarter:
- It posted quarterly revenue of $94.4 million — its fourth consecutive quarter of profit!
- It also reduced its debt by $70 million through a revolving credit facility.
It’s not explosive growth, but it’s there stable.
A company shows strength in our quality metrics, where it scores 85.
PBF Logistics’ return on equity is an excellent 62.4% — more than double the industry average of 25.1%.
Its margins (gross, net and operating) are also higher than peers.
These numbers tell us that PBFX is an outstanding growth and quality stock relative to the rest of the energy industry.
After hitting a low in June 2022, PBFX soared more than 50% in August.
Profits declined due to a broader selloff in the market, but stocks still up 62% over the past 12 months.
PBF Logistics LP stock valuation a 94 overall in our proprietary inventory power rating system.
That means we’re “strongly bullish” and expect it to beat the broader market at least three times during the next 12 months.
Result: We still rely on oil, which means we will continue to explore and pump more for our vehicles.
But it’s even more important to have special and efficient ways to store and transport oil before it gets into our gas tanks.
PBFX is the best candidate for your portfolio as a leader in petroleum logistics.
Stay tuned: Avoid this real estate promotion despite the skyrocketing house prices
I’m replacing it tomorrow Stock Power Daily. Instead of the highest rated company, I will now analyze the stocks to avoid.
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Matt Clark, CMSA®
Research Analyst, Money and Markets
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