PBF Energy: The Turnaround Has Arrived, But the Market Still Prices It Cheaply
Summary
I am retaining my STRONG BUY rating on PBF Energy following its second quarter 2026 results. My previous thesis depended heavily on the Martinez refinery returning to full operation, better West Coast refining conditions and measurable savings from the Refinery Business Improvement program. Martinez is now fully operational, refining conditions have strengthened considerably, and the cost program continues to deliver.
Q2 provides clear evidence that the recovery has moved from expectation to earnings. Income from operations reached $1.27 Bn, while adjusted fully converted net income excluding special items reached $753.1 Mn, or $6.22 per share, compared with a $118.5 Mn loss a year earlier.
The balance sheet has become considerably stronger. PBF reduced net debt by more than $1.4 Bn during Q2, ending the quarter with approximately $894 Mn of cash and $855 Mn of net debt. Meanwhile, the RBI program is expected to deliver more than $350 Mn of run rate cost improvements by year end 2026.
On December 12th, we will be bringing together investors and long-term thinkers at Fairmont Mt. Kenya Safari Club, Nanyuki for the Annual Henriot Capital Investor’s Summit. A full day of research, markets, meaningful conversations and shared experiences, built around one idea: long-term wealth conversations for future generations. Request an invitation below.
