PBF Energy Inc.

Based on a comprehensive analysis, PBF presents a nuanced investment case with significant risk-reward considerations.

Technical Analysis PBF shows encouraging near-term momentum with a strong monthly gain, recovering from its 52-week low. However, the stock remains in a broader corrective phase and may be approaching overbought territory after its recent rally. Its high volatility and position in the upper-middle of its annual range suggest cautious optimism is warranted for new entries.

Fundamental Analysis Fundamentally, PBF faces clear headwinds with declining revenue and a recent dip into negative gross margins, indicating operational pressure. While the company maintains a conservative debt profile, its liquidity is constrained, and operational efficiency metrics like Return on Equity are subdued. The modest net income is a positive, but the overall picture points to a company navigating a challenging profitability environment.

Valuation & Risk The valuation is speculative, hinging entirely on a forecasted earnings rebound as evidenced by the reasonable forward P/E. The stock trades below its book value, suggesting potential undervaluation if operations improve. Key risks include the stark disconnect between its low beta and its history of severe drawdowns, as well as exposure to volatile refining margins and crack spreads.

Recommendation: HOLD While the forward valuation appears attractive and the technical rebound is notable, the weak recent profitability and operational challenges present significant uncertainty. The stock is best suited for investors with a higher risk tolerance who are bullish on a recovery in the refining sector. Current investors may hold, but new buyers should wait for more concrete signs of fundamental improvement before establishing a position.

*This is not investment advice, for reference only.*

RockFlow Model Forecast: Three Scenarios for 2026

Based on a comprehensive analysis, PBF's 12-month outlook is highly dependent on the volatile refining market.

1. Key Catalysts: The primary catalyst is a sustained recovery in refining margins and crack spreads. An improvement in operational efficiency leading to a return to positive gross margins would be a significant positive signal for the stock. The current valuation, trading below book value, provides a margin of safety if a sector-wide turnaround occurs.

2. Potential Risks: The major risks are continued pressure on profitability from declining revenue and weak margins. The company's constrained liquidity could become a more pressing issue if operational challenges persist. The stock's history of severe drawdowns, despite its low beta, highlights its inherent volatility and exposure to unpredictable energy market swings.

3. Target Price Range: Given the high degree of uncertainty and the lack of a consensus analyst target price, a specific range is speculative. The outlook suggests the stock is likely to remain range-bound in the near term, with significant upside potential only materializing upon a clear and sustained improvement in fundamental operating metrics. Investors should monitor quarterly earnings for signs of this improvement.

Wall Street Consensus

Most Wall Street analysts are optimistic about PBF Energy Inc.'s 12-month outlook, with consensus target around $33.90, indicating expected upside potential.

Overall, PBF has investment potential but also faces challenges. Here are key factors to weigh before investing.

PBF has demonstrated strong near-term momentum but remains in a broader corrective phase from its recent highs. The stock shows significant volatility relative to its longer-term performance, with a notable recovery from its 52-week low.

The stock has experienced a robust 8.88% gain over the past month, suggesting positive short-term sentiment. However, this is overshadowed by a significant 15.61% decline over three months, during which it underperformed the market by approximately 15.59%, indicating recent relative weakness.

Currently trading at $33.96, PBF sits approximately 35% above its 52-week low but 18% below its yearly high, positioning it in the upper-middle portion of its annual range. While not at extreme levels, the stock may be approaching overbought territory given its sharp recovery from the lower bounds of its range, especially considering its recent positive momentum and high beta.

Revenue & Profitability PBF's Q4 2025 revenue declined to $7.14 billion from Q3's $7.65 billion, while profitability deteriorated significantly with a negative gross margin of -1.85% versus Q3's positive 0.51%. Despite this gross profit decline, the company maintained modest positive net income of $78 million, though the net margin compressed to 1.1% from Q3's 2.2%.

Financial Health The company maintains a conservative debt profile with a debt ratio of 22.3% and debt-to-equity of 0.55, indicating moderate leverage. However, the quick ratio of 0.51 reveals limited immediate liquidity, while the cash flow to debt ratio of 0.13 suggests constrained capacity for debt servicing from operating cash flows.

Operational Efficiency Operational efficiency metrics show challenges, with return on equity at a subdued 1.5% and asset turnover of 0.55 reflecting modest utilization of the company's asset base. The 36.5-day cash conversion cycle indicates reasonably efficient working capital management, though inventory turnover of 2.8 suggests room for improvement in inventory management efficiency.

Valuation Level: The negative trailing PE ratio indicates PBF incurred a net loss over the past twelve months, making the TTM metric uninformative for valuation. However, the forward PE of approximately 10.1 suggests the market anticipates a significant return to profitability, presenting a potentially reasonable valuation if earnings projections are met. The negative EV/EBITDA further corroborates recent operational challenges but aligns with the forward-looking earnings rebound implied by the PE ratio.

Peer Comparison: Without specific industry averages for comparison, a definitive peer-based valuation assessment is not possible. The forward PE of 10.1 appears attractive relative to broad market averages, suggesting potential undervaluation if the company's projected earnings recovery is in line with or exceeds sector performance. The low price-to-book ratio of 0.73 indicates the stock is trading below its accounting net asset value, which could signal value if the assets are productive.

Volatility Risk: PBF's beta of 0.406 indicates the stock has historically been significantly less volatile than the broader market, potentially offering some cushion during downturns. However, this defensive characteristic is contradicted by the substantial one-year maximum drawdown of -41.06%, revealing a pronounced vulnerability to severe price declines despite its low beta. This discrepancy suggests the stock may be susceptible to sharp, company-specific or industry-related shocks.

Other Risks: The notable absence of reported short interest could imply a general market consensus on the stock's stability or a niche status making it unattractive for short selling. This lack of speculative bearish pressure is generally positive, though it should be assessed alongside liquidity metrics which are not provided; limited trading volume could present challenges in executing large orders without impacting the price. Investors should consider industry-specific headwinds affecting this refining company, such as fluctuations in crack spreads and regulatory risks.