) recently secured rights from U.S. energy behemoth
) for the use of Exxon and Mobil brands of the latter at retail
stations in Northern California, Oregon, Western Washington and
Nevada. Tesoro further secured rights to use these brands all
through the Minnesota, Central/Eastern North Dakota and
Northeastern South Dakota marketing areas.
This will help Tesoro in assuming the ownership of branded
wholesale supply contracts for 54 Exxon or Mobil branded retail
stations in Minnesota.
Management at Tesoro believes that the inclusion of the well
recognized Exxon and Mobil brands into their retail network will
help in further integration of their refining and marketing
business with brands known for their quality products and
The contracts are expected to be executed by 2013 end and market
launch is expected to begin in 2014.
Tesoro is one of the largest independent oil refiners in the U.S.
with a combined crude oil processing capacity of approximately
675,000 Bbl/d. A major advantage for the company is the scale and
diversification benefits afforded by its portfolio of seven
Last month, the company reported bright first quarter 2013
results on the back of higher margins and favorable market
conditions. Earnings per share (excluding special items) came in
at 73 cents, managing to beat the Zacks Consensus Estimate of 71
cents and improving from the year-ago adjusted profit of 39 cents
However, the inherent volatility of the refining business reduces
the accuracy and reliability of long-term earnings and revenue
estimates. Additionally, results are exposed to unplanned
shut-downs that may have a lingering impact.
Tesoro currently retains a Zacks Rank #3 (Hold). But there are
other refiner and marketers in the energy sector that are good
buying options. These include
Ferrellgas Partners LP
) with Zacks Rank #1 (Strong Buy) and
) with Zacks Rank #2 (Buy).
FERRELLGAS -LP (FGP): Free Stock Analysis
PHILLIPS 66 (PSX): Free Stock Analysis Report
TESORO CORP (TSO): Free Stock Analysis Report
EXXON MOBIL CRP (XOM): Free Stock Analysis
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