Value
6.9/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 2.7 |
| P/S | 10.0 |
| EV/EBITDA | 8.3 |
| Fwd P/E | 7.3 |
| PEG | 10.0 |
| Analyst target | 3.0 |
- ▸Forward P/E: 17.0x
- ▸PEG: 0.10
CVI · Why this verdict
Why CVR Energy (CVI) is rated HOLD
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictHOLD
Overall score5.9/10
ConfidenceMEDIUM
MacroNEUTRAL
TrendMatrix Research · core thesis
Engine thesis — one sentence
CVR Energy's revenue grew approximately 20% year-over-year and the stock sits roughly 24% below a near-term technical target with a favorable reward-to-risk profile at roughly 4.7 to 1. However, business quality is at 2.1 out of 10 — well below the 4.0 minimum required for a constructive position — free cash flow is slightly negative, short interest is elevated at 16%, and the options market is heavily skewed toward puts, making the quality deficiency the decisive barrier to entry.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Business quality sits at 2.1 out of 10 — well below the 4.0 minimum — with free cash flow slightly negative relative to revenue, negligible operating and net margins, and a Piotroski F-Score of only 5.6 out of 9, making this a cash-consuming operation that does not meet the baseline criteria for a constructive investment. Quality breakdown | Free cash flow turns positive relative to revenue for 2 consecutive quarters, representing the minimum quality improvement required to reconsider the setup. | →Stable |
| CounterRefining margins are cyclical; a favorable crack-spread environment could rapidly lift operating margins and push free cash flow into positive territory, making the current quality reading a cyclical trough rather than a structural condition. | ||
Short interest at 16% of float and a put/call ratio above 3.3 indicate a large and concentrated bearish positioning; this creates persistent supply of stock for sale and signals that institutional participants expect further deterioration. Risk breakdown | Short interest falls below 8% of float within 2 quarters, suggesting the bearish positioning has unwound sufficiently to reduce structural selling pressure. | ↑Improving |
| CounterHigh short interest can serve as fuel for a sharp reversal; if the company delivers an earnings surprise or refining margins recover, the forced covering of short positions could produce a rapid price spike. | ||
Revenue grew approximately 20% year-over-year — ranking among the higher-growth profiles in the peer group — suggesting throughput volumes or realized prices improved meaningfully over the prior period. Growth breakdown | Revenue growth stays above 10% year-over-year for 2 consecutive quarters, confirming the expansion is sustained rather than a one-period anomaly. | →Stable |
| CounterRefining revenue is highly sensitive to feedstock costs and product crack spreads; a single quarter of spread compression can erase a full year of topline gains without any corresponding change in volumes. | ||
Two of the last four quarters missed consensus, including a deeply negative surprise in the most recent period, and the four-quarter average surprise is well below zero; this volatility makes forward earnings projections unreliable and the forward valuation potentially misleading. Earnings | Average quarterly earnings surprise turns positive and stays above 5% for 3 consecutive quarters, restoring a basic level of delivery consistency. | ↑Improving |
| CounterThe two prior-period beats included a large positive surprise; the most recent miss may reflect a one-time item rather than a sustained deterioration in earnings quality, and the business has demonstrated it can execute well when margins cooperate. | ||
Business quality sits at 2.1 out of 10 — well below the 4.0 minimum — with free cash flow slightly negative relative to revenue, negligible operating and net margins, and a Piotroski F-Score of only 5.6 out of 9, making this a cash-consuming operation that does not meet the baseline criteria for a constructive investment.
→StableQuality breakdown
- Expectation
- Free cash flow turns positive relative to revenue for 2 consecutive quarters, representing the minimum quality improvement required to reconsider the setup.
CounterRefining margins are cyclical; a favorable crack-spread environment could rapidly lift operating margins and push free cash flow into positive territory, making the current quality reading a cyclical trough rather than a structural condition.
Short interest at 16% of float and a put/call ratio above 3.3 indicate a large and concentrated bearish positioning; this creates persistent supply of stock for sale and signals that institutional participants expect further deterioration.
↑ImprovingRisk breakdown
- Expectation
- Short interest falls below 8% of float within 2 quarters, suggesting the bearish positioning has unwound sufficiently to reduce structural selling pressure.
CounterHigh short interest can serve as fuel for a sharp reversal; if the company delivers an earnings surprise or refining margins recover, the forced covering of short positions could produce a rapid price spike.
Revenue grew approximately 20% year-over-year — ranking among the higher-growth profiles in the peer group — suggesting throughput volumes or realized prices improved meaningfully over the prior period.
→StableGrowth breakdown
- Expectation
- Revenue growth stays above 10% year-over-year for 2 consecutive quarters, confirming the expansion is sustained rather than a one-period anomaly.
CounterRefining revenue is highly sensitive to feedstock costs and product crack spreads; a single quarter of spread compression can erase a full year of topline gains without any corresponding change in volumes.
Two of the last four quarters missed consensus, including a deeply negative surprise in the most recent period, and the four-quarter average surprise is well below zero; this volatility makes forward earnings projections unreliable and the forward valuation potentially misleading.
↑ImprovingEarnings
- Expectation
- Average quarterly earnings surprise turns positive and stays above 5% for 3 consecutive quarters, restoring a basic level of delivery consistency.
CounterThe two prior-period beats included a large positive surprise; the most recent miss may reflect a one-time item rather than a sustained deterioration in earnings quality, and the business has demonstrated it can execute well when margins cooperate.
Per-dimension breakdown
Quality
4.6/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 8.1 |
| ROA | 3.7 |
| Gross margin | 0.0 |
| Op margin | 1.1 |
| Net margin | 0.4 |
| Current ratio | 5.3 |
| FCF quality | 10.0 |
| Moat | 6.0 |
| Piotroski F | 6.7 |
- ▸Excellent cash conversion: 311% FCF/NI
Growth
10.0/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 10.0 |
| EPS growth | 10.0 |
- ▸Strong growth: 56% YoY
Momentum
4.7/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 5.5 |
| MACD | 0.0 |
| OBV | 10.0 |
| MA position | 8.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Above 200-MA but MA slope flat
Sentiment
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 2.2 |
| Analyst rating | 5.0 |
| Price target | 3.2 |
- ▸LLM news sentiment: -0.55 (n=1)
- ▸Below analyst target
Insider
7.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 10.0 |
| notable moves | 7.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
- ▸Institutions accumulating
Peer rank
4.0/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 2.2 |
| quality rank | 4.7 |
| growth rank | 7.2 |
Technical
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 4.7 |
| support resistance | 5.9 |
| 52w position | 6.4 |
| gap | 5.0 |
Risk (lower is worse)
3.5/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 1.7 |
| days to cover | 5.9 |
| volatility | 0.0 |
| put call | 6.0 |
| implied vol | 0.0 |
| beta | 8.1 |
| debt equity | 2.6 |
- ▸High short interest justified: 18%
- ▸High IV: 81%
- ▸Concentration risks: 4 MED (10-K Item 1A)
Catalyst
6.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 4.0 |
| earnings history | 6.7 |
| earnings timing | 5.0 |
| surprise avg | 10.0 |
| dividend safety | 6.8 |
| news activity | 5.0 |
- ▸Strong earnings: 3B/1M
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position. | News modifier +2 (SELL_IF_HOLDING → HOLD_IF_HOLDING).
Engine technical detail
verdict_path:
L4:PATH_F_SELL|L3:NEWS_MOD=+2Passed (7)
- MOMENTUM:4.7>=4.5
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:78d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (1)
- ASYMMETRY:-1.8=NEGATIVE
Warning (1)
- MOMENTUM:4.7<5.5 (soft — BUY_NOW allowed but watch)
Reward-to-Risk
-1.82
Upside
-24.0%
Downside
13.2%
Sizing output
AVOID
SetupRange Bound — RSI 47 mid-range, Bollinger mid-band
EdgeNo clear edge — No clear edge identified
SuitabilityAggressive — MCap $3.3B<$5B
Investment implication
The F-path SELL output reflects an overall score of 4.4 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 10.0) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( ASYMMETRY:-1.8=NEGATIVE) reinforce the read. Current asymmetry R:R is -1.82 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 10.0, Insider at 7.3, and Value at 6.9; the weakest are Risk (lower is worse) at 3.5, Sentiment at 3.5, and Peer rank at 4.0. The V9 engine flagged 1 failed gate with 1 warning, producing an asymmetric reward-to-risk of -1.82 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Quality Well Below Threshold
Trip ifFree cash flow rises above 0% of revenue for 2 consecutive quarters, indicating the business has crossed into cash-generative territory.
- P2Heavy Short Options Positioning
Trip ifShort interest falls below 8% of float for 2 consecutive months.
- P3Revenue Growth Tailwind
Trip ifRevenue growth falls below 10% year-over-year for 2 consecutive quarters.
- P4Earnings Inconsistency Risk
Trip ifAverage quarterly earnings surprise exceeds 5% for 3 consecutive quarters.