TD upgrades Delek US to Hold on EPA refinery exemption

TD Cowen upgraded Delek US (DK) to Hold from Sell with a price target of $28, up from $15. The firm views the company’s award of small refinery exemptions as a “big deal.” The Environmental Protection Agency’s small refinery exemption decision enables Delek to recoup up to an estimated $400M historical renewable identification numbers expense and an estimated $150M per year on a go-forward basis through at least 2027, the analyst tells investors in a research note. TD also expects the comma to benefit from the crude market structure flipping to contango.