HF Sinclair: A Mildly Interesting Anomaly

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It has come to our attention – and, frankly, it’s a bit of a statistical improbability – that DDD Partners has reduced its holdings in HF Sinclair (DINO +0.79%) by approximately 125,198 shares. This equates to roughly $6.45 million, calculated using the rather arbitrary metric of quarterly average pricing. (One wonders, of course, if the universe is merely calculating the probability of such transactions happening, and we’re just observing the outcome. It’s a thought.)

What Actually Happened

On January 22nd, a filing with the SEC revealed that DDD Partners engaged in a bit of share shedding, parting ways with 125,198 shares of HF Sinclair. The estimated transaction value, based on the aforementioned quarterly average, was $6.45 million. The firm’s overall position, however, experienced a more substantial decline – $8.37 million – which includes both the aforementioned sales and the unpredictable whims of market valuation. (Market valuation being, of course, a complex algorithm based on hope, fear, and the occasional rogue pigeon.)

A Slightly Larger Picture

Currently, HF Sinclair constitutes a mere 0.85% of DDD Partners’ reported assets. This is, statistically speaking, less than the probability of finding a matching pair of socks in a laundry basket. (Although, admittedly, the laundry basket is a far more chaotic system.) Let’s take a look at where their money is going:

  • NASDAQ: MSFT: $555.66 million (35.4% of AUM)
  • NYSE: BRK-B: $57.31 million (3.6% of AUM)
  • NASDAQ: AAPL: $44.69 million (2.8% of AUM)
  • NASDAQ: AMZN: $41.45 million (2.6% of AUM)
  • NASDAQ: AVGO: $30.14 million (1.9% of AUM)

As of January 21st, HF Sinclair shares were trading at $50.03, a figure representing a rather impressive 44.8% increase over the past year. This is, incidentally, significantly better than the S&P 500’s more modest 14% gain. (Which, let’s be honest, is a bit like comparing a rocket ship to a moderately enthusiastic bicycle.)

Company Overview (Briefly)

Metric Value
Revenue (TTM) $26.90 billion
Net Income (TTM) $393.49 million
Dividend Yield 4%
Price (as of 1/21/26) $50.03

The Snapshot (Even Briefer)

  • HF Sinclair produces and markets a bewildering array of petroleum-based products, including gasoline, diesel, and something called “renewable diesel.” (The definition of “renewable” being, naturally, open to interpretation.)
  • Revenue is generated through the sale of these products, as well as through the somewhat mysterious process of “transportation” and the licensing of the Sinclair brand.
  • They primarily serve wholesale distributors, independent stations, and industrial customers in a geographically limited area. (One wonders if they have considered expanding into other dimensions.)

HF Sinclair, in essence, is an independent energy company focused on refining and marketing. They have a diversified portfolio and established distribution channels, which, in the grand scheme of things, is a reasonably sensible business model.

What This Means for Investors (Possibly)

HF Sinclair has, over the past year, delivered precisely what energy investors crave: strong cash generation, disciplined capital allocation, and leverage to refining margins that have stubbornly refused to collapse. Their most recent quarterly results showed a net income of $403 million (up from a loss of $76 million a year ago) and reaffirmed their commitment to returning capital to shareholders. (This is generally considered a good thing, unless you happen to be a shareholder who prefers to keep their capital.)

Against this backdrop, the share reduction seems less like a bearish signal and more like simple portfolio rebalancing. A stock that outperforms the S&P 500 by 30 percentage points is bound to attract some profit-taking, especially in a fund dominated by technology giants. (It’s a bit like finding a particularly shiny pebble on a beach full of diamonds; you might decide to take a profit.)

In short, HF Sinclair’s fundamentals haven’t suddenly deteriorated. Energy remains cyclical, and extraordinary gains rarely last forever. The stock’s future performance will likely depend on refining margins, renewable diesel economics, and management’s ability to continue returning cash when the inevitable downturn arrives. (Which, statistically speaking, is bound to happen eventually.)

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2026-01-24 20:14