ANDV

Andeavor

Energy


Presented:06/22/2017
Price:$91.06
Cap:$10.75B
Current Price:$153.50
Cap:$23.20B

Presented

Date06/22/2017
Price$91.06
Market Cap$10.75B
Ent Value$16.77B
P/E Ratio15.25x
Book Value$46.73
Div Yield2.38%
Shares O/S118.10M
Ave Daily Vol2,490,552
Short Int8.36%

Current

Price$153.50
Market Cap$23.20B
Andeavor engages in the refining and marketing of petroleum products. The company operates through the following segments: Refining, Logistics and Marketing. The Refining segment refines crude oil and other feed stocks into transportation fuels, such as gasoline and gasoline blend stocks, jet fuel and diesel fuel, as well as other products, including heavy fuel oils, liquefied petroleum gas and petroleum coke for sale in bulk markets to a wide variety of customers within Tesoro's markets. The Logistics segment includes crude oil and natural gas gathering assets, natural gas and natural gas liquid processing assets, and crude oil and refined products terminalling, transportation and storage assets acquired from Tesoro and third parties. The Marketing segment sells transportation fuels through branded and unbranded channels. Its brand portfolio includes ARCO, Shell, Exxon, Mobil, USA Gasoline, Rebel and Tesoro. Tesoro was founded by West V. Robert, Jr. in 1968 and is headquartered in San Antonio, TX.,000XNQ-E

Please note, on 8/1/17 Tesoro Corporation (TSO) changed its company name and ticker to Endeavor (ANDV). The content of this idea will make reference to the original company name and ticker symbol.

Publicly traded companies mentioned herein: Tesoro Corp (TSO), Tesoro Logistics LP (TLLP), Western Refining Logistics LP (WNRL)

Highlights

On a sum-of-the-parts basis (SOTP), the presenter views Tesoro Corp stock (TSO) as cheap. He is long at $90 and sees upside for shareholders following the closure of the $5.8 billion Western Refining deal (June 1, 2017). A key to unlocking the value lies in the potential combination of Tesoro’s TLLP and Western’s WNRL, as has been contemplated by management. Rolling the LPs into one and exchanging the incentive distribution rights (IDRs) for units in the pro forma entity will place all of the unrecognized value “purely in the common units, so it will be observable”. Longer-term, there are many levers for the management team to pull as well, which should help push the stock price up to the $110-130 range.

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Idea Discussion

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