I only eat caged eggs, source my electricity from coal, and spray glycosulfate for fun. I also like jokes and financial speculation….note ….speculation!!
Joined April 2026
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barrier island man retweeted
$CLMT Reposting why I'm ~100% all in w/ extreme conviction that CLMT should be a $80-$100 equity TODAY
1) We now have hard evidence Calumet core specialties biz (ex Montana Renewables) is annualizing ~$1B FCF @ $5 base oil cracks (structurally supported by Train 2 @ Shell Pearl GTL in Qatar down untill Q2-Q3'27) given the $280M cash outlay required to have redeemed $250M '28s @ 102 + accrued int & $16M of sale & leaseback @ Montana Terminal with cash generated from 7/1 thru 10/14 (*critical to note the $100M redemption on '28s @ 7/8 was NOT drawn on ABL, but generated w/ July cash flow per my convo w/ mgmt)
2) Over the next 12 mo's @ spot $3.50/gal RD index (structurally supported by the looming negative RIN bank come March + EPA stance on SRE's) MRL will do $650M EBITDA @ 87% ownership as SAF ramps 4kbpd --> 10kbpd @ $1/gal contracted premium to RD, less $103M of recently announced self-funded phase 2 growth capex, less $25M maintenance capex, less $35M inter-company loan interest paid to Calumet, less $0 cash interest on PIK'ing DOE loan = ~$500M FCF.
**If spot conditions last another 12 months....that is... $5/gal base oil cracks + $3.50 RD index margins....****
$CLMT will do $1.5B combined FCF on today's $4.3 billion market cap = 35% yield
Uses?
$1B FCF @ parent = organically pay down $175M remaining '28s @ 102 ($184M cash cost) , $200M '29s @ par > Jan 15, $555M '31s @ 104 make whole ($590M cash cost), cuts $90M cash interest.
$500M FCF @ MRL = organically pay down $408M intercompany loan balance + begin to pay down $100M of the $348M outstanding Warburg pref
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Normalized mid-cycle FCF after 12 months of euphoria?
1) Completely de-levered Core specialties biz:
$300M mid-cycle EBITDA ($300M SPS + $50M PB + $20M Asphalt less $70M corporate)
- $75M recurring capex
- $0 cash interest ('28s, '29s, '31s wiped)
- $75M cash taxes after ~$1B federal NOL's expire
= $150M levered FCF
2) Montana Renewables:
$600M mid-cycle EBITDA @ 87% ownership @ $2.25 RD index & $0.35/gal fully loaded site opex & $0.30/gal feedstock transport (split $500M from 13kbpd SAF @ $1 premium+ 1kbpd RD, $15M from high octane naphta byproducts + $75M from LPG off-gas recovery getting normalized D5 RINs)
- $25M recurring maintenance capex
- $45M DOE loan cash interest on $900M balance
= $530M levered FCF
= ~$700M combined normalized 2028 mid-cycle levered FCF
/ 88M fully diluted shares outstanding
= $8 levered FCF per share
@ 12-15x (6-8% yield) = $96 - $120 per share
NPV discounted 2 years @ 10% = $80-$100 per share TODAY
$CLMT extrapolate the deleveraging cadence....mgmt wiped $266 million of debt in exactly 3.5 months since 7/1 thru 10/14 with > $5/gal base oil cracks in the core SPS biz (see pic). Whats left is $930 million of very high cost debt on the balance sheet @ $90 million of cash interest. ***If base oil cracks remain > $5/gal***, $930M of debt and $90 million of cash interest gets wiped in exactly 12 months (930/266 x 3.5 = 12 mo's). Whats $930M of deleverage + $90 million of cash interest worth to CLMT equity? ~$11/share of debt + ~$11/share of capitalized interest @ 10x = $22/share. With leverage significantly reduced, you get multiple expansion. Lets assume a conservative re-rate from 8x to 10x mid-cycle. Core mid-cycle EBITDA = $300M @ 10x = $3B. MRL phase 2 @ mid-cycle priced off the Dec '27 futures curve = $600M @ 10x = $6B. Core + MRL = $9B EV. Over this 12 month period, MRL cash flows @ $400M, takes out $400M intercompany loan. Roll the consolidated balance sheet forward to year end '27. With 87 million shares out, you have a $100+ stock. Very simple playbook.
$ff look at the little engine that could. I reran my numbers I was in the 15-20m ebitda for q3. I’m at 20-26 mil now. I’m truly excited to be part of this story. Got our biofuel division just printing money and a growing and CUSTOMER FUNDED specialty chem business benefiting from re shoring etc. I’m a giant fan of management too. The CFO is a 30 year vet of the company that watches things like a hawk and the CEO is a veteran chemical guy who is very hands on and is eager to build something unique. Enjoy the ride people it’s going to be fun and profitable.
Hey @Zerosumgame33 . Just for shits and grins….what would a sale of MRL do for the equity if was sold at your objective multiple?
$clmt couple things where I see major opportunity building:
1)As funds and pods continue to get ass raped on their ai bets, they are selling winners to meet margin calls etc
2)Your macro tourists that think this is just a diesel play are getting out for the fake peace deal; not knowing any of the rvo mechanics behind the next couple years, and believing the world is in instantly hunky dory because someone said something.
3) dovetailing on point 2. My estimation is the tourists are now putting on shorts again without knowing shit on the company….need proof look at Goldmans analyst(university of phoenix really upgraded their career services dept)……and buying into the fake peace deal.
This is setting up for a sweet run over the next couple days weeks.
$clmt I doubled my share count and have a ton of puts sold short. If I get assigned….. great!
Has anyone ever pawned their wife’s wedding ring to buy more $clmt? Asking for a friend
barrier island man retweeted
1. A lot of market chatter about the decline in D4 (and D6) RIN prices since peaking at over $2.50 in early July. What does the decline mean? Here is my take. Diesel prices have risen by about $2 per gallon since July 1. Divide that by a 1.6 average conversion coefficient and you get $1.25. So, D4 prices should have declined by $1.25 since July 1st based on the decline in diesel prices, all else constant. The fact that they have not declined that much speaks to the underlying bullishness for D4 RINS. Think about this way. Today's D4 RIN price of $1.75 with $5 ULSD is equivalent to a $3 D4 price with $3 ULSD (the price back on July 1). 🤯
