CRAK: Record Refining Margins Still Look Cheap At 9x Earnings

Daniel James 507 Followers Follow Summary The VanEck Oil Refiners ETF is rated a speculative Buy, benefiting from record diesel crack spreads and tight global refining capacity. CRAK trades at only 9.1x trailing earnings despite a 79% one-year rally, with trailing results not yet reflecting the full margin environment. Portfolio diversification reduces single-company and regulatory risks, but CRAK is not a pure U.S. diesel play and carries international exposures. This is a tactical, cyclical trade—attractive while shortages persist, but less compelling once refinery margins normalize. zhaojiankang/iStock via Getty Images Introduction The VanEck Oil Refiners ETF ( CRAK ) has already gained approximately 79% over the past year, so this isn 't an undiscovered trade. By August 21, several of its largest U.S. holdings had already more than doubled in This article was written by Daniel James 507 Followers Follow I am a part-time investor interested in equities, ETFs, macro, and emerging markets. Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.