Par Pacific: The Earnings Power Is Real, but the Easy Upside Is Gone
HOLD Updated rating | $79.89 Share price, Aug. 31 | $78 Present target |
Summary
Par Pacific delivered $2.97 Bn of revenue, $571.3 Mn of adjusted EBITDA, and $10.10 of adjusted EPS in Q2 2026. Revenue and EPS beat the public consensus figures of $2.40 Bn and $8.22, respectively.
The strongest part of the old thesis was confirmed: Par Pacific can convert its Pacific and Rockies footprint into exceptional cash earnings when distillate markets tighten. The catch is that $552.0 Mn of quarterly adjusted EBITDA came from refining.
My normalized 2027 model produces about $7.40 Bn of revenue, $600 Mn of adjusted EBITDA, and $8.10 of adjusted EPS. A 10.5x future P/E, discounted one year at 10%, supports a base value near $77; probability-weighted scenarios produce a $78 present target.
I downgrade Par Pacific from Strong Buy to Hold. The operating thesis strengthened, but the valuation margin of safety narrowed at $79.89 per share as of August 31, 2026.
