Refining Stocks Rise as Deutsche Bank Upgrades

Refining Stocks Rise as Deutsche Bank Upgrades

Refining stocks rose as investors took a fresh look at the sector after a Deutsche Bank analyst raised his rating on Holly Corp. and Tesoro Corp.

Analyst Paul Sankey hiked his ratings on Holly and Tesoro to “Hold” from “Sell.” He upgraded the stocks because they were relatively cheap, not because of any major change by the companies themselves. Like many of their competitors, the two companies have seen their share prices plummet as oil prices soared in recent months.

Sankey said Dallas-based Holly “rightly has a high reputation regarding both its assets and its management.” In afternoon trading, shares surged $4.54, or 10.7 percent, to $46.99.

As for Tesoro, the analyst noted that challenges remain in California, where the San Antonio, Texas-based company is active.

“With the stock trading in the mid-$20s, we believe the only remaining ‘Sell’ case is predicated on the company going bankrupt, and we do not believe this is a major danger,” Sankey wrote in a client note.

Tesoro shares jumped $1.88, or 7.6 percent, to $26.72.

Other gainers included Valero Energy Corp. — $1.43, or 2.8 percent, to $52.27 — and Sunoco Inc., which climbed $2.18, or 4.9 percent, to $46.65.

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