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Why Alon USA Energy's Shares Jumped

By Travis Hoium - Nov 6, 2012 at 4:37PM

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Is this meaningful or just another movement?

What: Shares of refiner Alon USA Energy (NYSE: ALJ) rose 12% today after reporting earnings.

So what: Third-quarter revenue rose 16% to $2.36 billion, well ahead of the $2.18 billion analysts expected. Net income rose 51% to $43.2 million, or $0.84 per share, also ahead of the $0.59 Wall Street expected.

Now what: Results were driven by a strong margin at the company's Big Spring refinery, which generated a $28.19-per-barrel operating margin. Right now, refiners are in a sweet spot of low oil prices and elevated gas prices, but the high margins may not last forever. Still, I like the operating excellence at Alon and think there's upside for investors if oil doesn't jump too fast like it's doing today.

Interested in more info on Alon USA Energy? Add it to your watchlist by clicking here.

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