Bullish Case: PBF Energy's push towards renewable diesel could significantly boost earnings amidst rising green energy demand. Strong historical performance indicates potential for upward price movement.

Bearish Case: Recent declines in refining margins and increased market uncertainty pose risks to PBF Energy's profitability. High implied volatility suggests fear of downward price movements in the near future.

Potential Outcomes:

1. 60% chance: Favorable refining margins boost earnings, lifting stock price.

2. 25% chance: Renewed market volatility leads to price decline.

3. 15% chance: Regulatory challenges impact renewable transition, negatively affecting share value.

Trading Oracle: Implement a bullish credit spread by selling $29 Puts and buying $28 Puts, targeting expiration in 45 days. This strategy is aligned with current market conditions, offers a high probability of profit (around 75%), and capitalizes on potential mean-reversion in a stable price environment.

November 05, 2024