PARR PARR

The price pays for

• The 678% year-over-year surge in Q2 net income and the $57 per barrel Hawaii refining margin, which are historical facts the market has clearly absorbed.
• The 30% valuation discount to peers, as the price embeds a 4.7x earnings multiple and a 3.9x EV/EBITDA multiple that assume margins will eventually compress from current peaks.
• The $220 million net debt reduction, which improves the balance sheet but is already reflected in the enterprise value and equity value.
• A 3.8% revenue growth rate going forward, which assumes the recent -6.4% decline reverses even as the company cycles through its current margin strength.
• The Q3 dip in Hawaii margin capture below the 100%-110% normalized range due to the plant-wide turnaround, which the market treats as a temporary event rather than a structural shift.

It declines to pay for