CVR Energy: 2Q26 Post Mortem and Model Update

研报英文原文证据摘录

J P M O R G A N

North America Equity Research

11 August 2026

CVR Energy

Underweight

CVI, CVI US

Price (10 Aug 26):$32.42

2Q26 Post Mortem and Model Update

▲Price Target (Dec-26):$32.00

Prior (Dec-26):$25.00

JPM View: In his first earnings call since being promoted to President and CEO

following Mark Pytosh's resignation, Dane Neumann emphasized strategic

continuity with a focus on, "commercial optimization to improve capture, and

pursuing accretive growth." CVI posted another quarter of strong operating results

with crude utilization of 98% and ammonia plant utilization of 99%, as ongoing

global conflicts created tightness across energy and fertilizer markets that directly

benefited the company's asset base. Management expressed optimism on the nearterm outlook for both segments and believes conditions could remain above midcycle well into 2027, noting the U.S. has remained fairly insulated and able to

benefit from these conditions given its relatively abundant supplies of crude oil,

natural gas, and critical refining infrastructure. Management reiterated that

reducing leverage remains a priority as the company works toward a $1 B gross

leverage target excluding CVR Partners, while noting there is opportunity to

discuss an incremental increase to the dividend if it can make meaningful progress

on the remaining debt balance. On M&A, CEO Neumann outlined a goal of

growing barrels and diversifying from CVI's core Southern Mid-Con region,

characterizing the current environment as an attractive time to transact given

refineries could trade at mid-cycle levels.

After refreshing our model for updated strip cracks, we raise our FY26 EPS

estimate to $0.78, which compares to our prior estimate at -$0.50 and the STe at $0.35. We forecast FY26 CFPS of $7.57, which compares to the STe at $4.36. We

model refining utilization at 96% in 2026, and we forecast a gross margin

of $10.73 per bbl and opex of $5.96 per bbl. We expect CVI to generate $496 MM of

consolidated FCF. After updating our model for updated strip cracks and adjusting

future operational assumptions, we raise our Dec-26 PT to $32 (from $25).

Leadership transition.…