PBF

Major Insider Continues Relentless Buying as PBF Energy($PBF) Shares Plummet 66%

04/07/2025 20:20

As PBF Energy Inc ($PBF) shares have plummeted approximately 66% from $44 to around $15 over the past ten months, one significant insider's persistent and aggressive buying pattern has captured investors' attention. Corporate insider Control Empresarial de Capitales SA de CV has been consistently purchasing PBF stock in large quantities almost weekly from June 2024 through April 2025. During this period, the entity acquired millions of shares totaling hundreds of millions of dollars. Most notably, the insider's purchasing activity intensified whenever the company's performance deteriorated and share prices declined. The U.S. refining industry has faced significant challenges in recent months. Weakened fuel demand, shrinking refining margins, and inventory buildups have created headwinds for most refiners. Several investment banks have continuously lowered their price targets for U.S. refiners to reflect these conditions. In June 2024, Wells Fargo reduced targets, followed by JP Morgan in July, Piper Sandler in September, and BMO Capital Markets in October, all cutting price targets for refiners including PBF Energy. These industry-wide challenges have directly impacted PBF Energy's performance. On August 1, 2024, the company reported a larger-than-expected quarterly loss, and on October 31, it announced another worse-than-anticipated loss for the third quarter. Despite these disappointing results, Control Empresarial de Capitales has viewed price declines as buying opportunities and steadily increased its stake. Particularly noteworthy is the continued purchasing even after a fire occurred at the company's Martinez refinery on February 1, 2025. On February 13, PBF Energy announced uncertainty regarding the duration of the Martinez refinery outage, causing shares to drop 11% to their lowest level since March 2022. The company also reported a third consecutive quarterly loss due to declining refining margins. Later, on March 6, the company estimated repair costs for the Martinez refinery would amount to approximately $30 million. Despite these operational challenges and negative news flow, Control Empresarial de Capitales did not cease its purchasing activities. In February and March 2025, it continued buying shares even as prices fell below $20 per share, and maintained buying in late March and early April when prices further declined to around $15. This persistent buying pattern suggests strong conviction in PBF Energy's long-term value despite current difficulties. PBF Energy is a major refiner operating six refineries across the United States with a combined processing capacity of approximately 1 million barrels per day. The company produces gasoline, ultra-low-sulfur diesel, heating oil, jet fuel, lubricants, petrochemicals, and asphalt. Financially, despite recent consecutive losses, the company previously recorded $46.8 billion in revenue and $2.88 billion in net income in 2022, indicating potential for profitability recovery when industry cycles improve. Additionally, the company paid a dividend of $0.275 per share for Q4 2024. Key factors that could impact PBF Energy's future performance include the timeline for fully restarting the Martinez refinery, potential recovery in refining margins, and fuel demand trends. The fire-damaged units at the Martinez refinery are not expected to restart until Q4 2025, which could negatively affect the company's production capacity and profitability in the short term. Meanwhile, changes in the Trump administration's tariff policies and Venezuelan crude import regulations represent additional variables that could affect U.S. refiners, including PBF Energy. Notably, PBF Energy is among the major buyers of Venezuelan crude, making it susceptible to shifts in U.S. policy toward Venezuela. For investors, Control Empresarial de Capitales' consistent buying could signal that the currently depressed share price may present a long-term buying opportunity. However, structural challenges in the refining industry and company-specific operational issues pose short-term risks. Particularly, the share price falling below $15 on April 4, marking a three-year low, demonstrates that market concerns remain significant despite insider conviction. In conclusion, while PBF Energy currently faces challenges due to industry-wide difficulties and company-specific operational issues, the major insider's persistent and aggressive buying reflects expectations for long-term value recovery. Investors should monitor potential catalysts such as refining margin improvements, full restart of the Martinez refinery, and positive trends in fuel demand.

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