• HF Sinclair recently completed its acquisition of Industrial Oils Unlimited, a U.S. manufacturer of industrial lubricants and specialty fluids, expanding its lubricants offering across the country.
• This move highlights HF Sinclair’s continuing push to grow its non-refining businesses through smaller bolt-on deals that build out higher-margin product lines.
• We’ll now examine how the Industrial Oils Unlimited acquisition may influence HF Sinclair’s existing investment narrative around expansion and diversification.

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HF Sinclair Investment Narrative Recap

To own HF Sinclair, you need to believe the company can steadily balance its core refining exposure with growing, higher-margin businesses like lubricants, midstream, and specialties. The Industrial Oils Unlimited deal fits this diversification story but is unlikely to change the key near term catalyst, which remains upcoming earnings and cash flow trends, or the biggest risk, that heavy capital and regulatory requirements could pressure margins and limit financial flexibility.

The Industrial Oils Unlimited acquisition directly ties into HF Sinclair’s recent emphasis on its Lubricants and Specialties segment, which has been highlighted by analysts as a buffer against refining volatility. This bolt on deal sits alongside the company’s ongoing capital structure work, such as the new US$2.0 billion revolving credit agreement, which supports liquidity to fund maintenance, turnarounds, and selective growth while managing the burden of its aging asset base.

But while diversification is improving on paper, the real concern investors should be aware of is the rising cost and complexity of keeping HF Sinclair’s older refining assets...

HF Sinclair's narrative projects $28.1 billion revenue and $956.2 million earnings by 2028.

Uncover how HF Sinclair's forecasts yield a $60.53 fair value, a 3% upside to its current price.

Exploring Other Perspectives

Some of the lowest analysts were assuming revenue could fall to about US$24.9 billion with earnings of roughly US$748.5 million by 2028, which is far more pessimistic than the view that Lubricants and Midstream can cushion refining swings, so it is worth comparing these expectations with how deals like Industrial Oils Unlimited might shift that balance over time.

Explore 5 other fair value estimates on HF Sinclair - why the stock might be worth 13% less than the current price!

Build Your Own HF Sinclair Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your HF Sinclair research is our analysis highlighting 3 key rewards and 1 important warning sign that could impact your investment decision.
• Our free HF Sinclair research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate HF Sinclair's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.