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Delek Logistics (DKL)
NYSE:DKL
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Delek Logistics
(NYSE:DKL)
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Rating:68Neutral
Price Target:
$48.00
▲(5.75% Upside)
Delek Logistics scores well due to its positive earnings call, highlighting strong EBITDA growth and strategic expansions. Despite financial challenges such as high leverage, the company's attractive valuation and high dividend yield provide a solid investment case. Technical indicators suggest a neutral trend, with potential for upward movement.
Positive Factors
Strategic Growth Initiatives
The successful commissioning of the Libby 2 gas plant enhances Delek Logistics' processing capabilities, supporting long-term growth and competitive positioning in the energy sector.
Financial Liquidity
Increased financial liquidity from the senior notes offering enhances Delek Logistics' ability to invest in growth opportunities, ensuring long-term financial stability and strategic flexibility.
Consistent Distribution Increases
Consistent increases in quarterly distributions demonstrate Delek Logistics' commitment to shareholder returns, reflecting strong cash flow generation and financial health over time.
Negative Factors
Revenue Volatility
Inconsistent revenue growth poses a challenge to Delek Logistics' financial performance, potentially impacting its ability to maintain stable cash flows and invest in future growth.
High Leverage
High leverage can strain Delek Logistics' financial flexibility, increasing risk and potentially limiting its ability to respond to market changes or invest in new opportunities.
Wholesale Marketing and Terminalling Performance
Declining performance in the Wholesale Marketing and Terminalling segment indicates potential challenges in maintaining profitability and competitiveness in this area, affecting overall financial health.
Delek Logistics (DKL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$2.42B
Dividend Yield9.76%
Average Volume (3M)53.41K
Price to Earnings (P/E)15.3
Beta (1Y)0.29
Revenue Growth-12.08%
EPS Growth1.44%
CountryUS
EmployeesN/A
SectorEnergy
Sector Strength52
IndustryOil & Gas Midstream
Share Statistics
EPS (TTM)0.83
Shares Outstanding53,463,830
10 Day Avg. Volume44,854
30 Day Avg. Volume53,415
Financial Highlights & Ratios
PEG RatioN/A
Price to Book (P/B)N/A
Price to Sales (P/S)N/A
P/FCF RatioN/A
Enterprise Value/Market Cap1.86
Enterprise Value/Revenue4.91
Enterprise Value/Gross Profit21.24
Enterprise Value/Ebitda10.93
Forecast
1Y Price Target
$45.00Price Target Upside-0.86% Downside
Rating ConsensusHold
Number of Analyst Covering1
Delek Logistics Business Overview & Revenue Model
Company DescriptionDelek Logistics Partners, LP owns and operates logistics and marketing assets for crude oil, and intermediate and refined products in the United States. It operates through three segments: Pipelines and Transportation, Wholesale Marketing and Terminalling, and Investment in Pipeline Joint Ventures. The Pipelines and Transportation segment includes pipelines, trucks, and ancillary assets that provide crude oil gathering, crude oil intermediate and refined products transportation, and storage services primarily in support of the Tyler, El Dorado, and Big Spring refineries, as well as offers crude oil and other products transportation services to third parties. This segment operates approximately 400 miles of crude oil transportation pipelines; 450 miles of refined product pipelines; and approximately 900 miles of crude oil gathering, and intermediate and refined products storage tanks with an aggregate of approximately 10.2 million barrels of active shell capacity. The Wholesale Marketing and Terminalling segment provides wholesale marketing, transporting, storage, and terminalling services related to refined products to independent third parties. The Investments in Pipeline Joint Ventures Segment owns a portion of three joint ventures that have constructed separate crude oil pipeline systems and related ancillary assets, which serves third parties and subsidiaries. Delek Logistics GP, LLC serves as the general partner of the company. Delek Logistics Partners, LP was incorporated in 2012 and is headquartered in Brentwood, Tennessee. Delek Logistics Partners, LP operates as a subsidiary of Delek US Holdings, Inc.
How the Company Makes MoneyDelek Logistics generates revenue through multiple key streams, primarily by charging fees for the transportation and storage of crude oil and refined products. This includes revenue from the operation of its extensive pipeline network, where it earns tolls based on the volume of product transported. Additionally, DKL benefits from long-term contracts with customers, providing a stable and predictable revenue base. The company also engages in terminal operations, where it earns fees for the storage and handling of petroleum products. Strategic partnerships, particularly with Delek US Holdings, enhance its earnings potential by ensuring a steady flow of product and access to a wider market. Factors contributing to its earnings include demand for energy infrastructure services, fluctuations in oil prices, and regulatory dynamics affecting the energy sector.
Delek Logistics Earnings Call Summary
Earnings Call Date:Jul 29, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 07, 2025
Earnings Call Sentiment Positive
The earnings call presented a largely positive outlook with significant achievements, such as record adjusted EBITDA, successful expansion projects, and increased distributions. Despite a minor setback in the Wholesale Marketing and Terminalling segment, the company's financial health and strategic growth initiatives provide a strong foundation for future performance.Q2-2025 Updates
Positive Updates
Record Quarterly Adjusted EBITDA
Delek Logistics Partners reported approximately $120 million in quarterly adjusted EBITDA, showing a significant increase from the $102 million in the same period of 2024.
Strong Performance in Gathering and Processing Segment
Adjusted EBITDA for the Gathering and Processing segment was $78 million, compared to $55 million in the second quarter of 2024, primarily due to the acquisitions of H2O and Gravity.
50th Consecutive Increase in Quarterly Distributions
The Board of Directors approved the 50th consecutive increase in quarterly distributions to $1.11 per unit.
Successful Commissioning of Libby 2 Gas Plant
The Libby 2 gas plant was successfully completed and transferred to operations on time and within budget, with expectations to be fully operational by year-end.
Increased Financial Liquidity
The high-yield notes offering increased availability by $700 million to over $1 billion, enhancing financial flexibility for future growth.
Negative Updates
Decrease in Wholesale Marketing and Terminalling EBITDA
Wholesale Marketing and Terminalling adjusted EBITDA was $23 million compared to $30 million in the prior year, primarily due to last summer's amend and extend agreements.
Company Guidance
During the Delek Logistics Partners Second Quarter 2025 Earnings Call, the company provided robust guidance, highlighting a projected full-year EBITDA of $480 million to $520 million. The second quarter saw a record adjusted EBITDA of approximately $120 million, marking an increase from $102 million in the same period of 2024. The Gathering and Processing segment contributed significantly with an adjusted EBITDA of $78 million, up from $55 million the previous year, primarily due to acquisitions of H2O and Gravity. The company announced the commissioning of the Libby 2 gas plant, expected to reach full capacity by the year's end, which supports this guidance. Additionally, Delek Logistics reported a 50th consecutive increase in quarterly distributions to $1.11 per unit, reinforcing its commitment to rewarding stakeholders. The company's strategic focus on expanding sour gas processing capabilities in the Delaware Basin, alongside prudent management of leverage and coverage, underscores its growth trajectory and competitive positioning in the Permian Basin.Delek Logistics Financial Statement Overview
Summary
Delek Logistics shows potential through strong operational efficiency and cash flow generation, yet faces challenges with revenue volatility and high leverage. The company must address its debt levels and stabilize revenue growth to improve its financial health.Income Statement
The income statement shows a mixed performance. The company has maintained a steady gross profit margin, but the net profit margin has seen fluctuations. Revenue growth has been inconsistent, with a notable decline in the latest period. Despite this, EBITDA margins suggest strong operational efficiency.70
Positive
Balance Sheet
The balance sheet reveals high leverage with a significant debt-to-equity ratio, indicating potential financial risk. However, the company has managed to maintain a positive equity ratio recently, which suggests some stabilization in its financial structure.50
Neutral
Cash Flow
Cash flow analysis indicates robust operating cash flow relative to net income, highlighting good cash conversion. However, free cash flow growth has been inconsistent, and heavy capital expenditures could impact future liquidity.65
Positive
| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 920.21M | 940.64M | 1.02B | 1.04B | 700.90M | 563.42M |
| Gross Profit | 212.61M | 243.75M | 284.96M | 249.40M | 217.15M | 206.74M |
| EBITDA | 413.08M | 394.70M | 370.99M | 301.95M | 256.14M | 236.09M |
| Net Income | 152.59M | 142.69M | 126.24M | 159.05M | 164.82M | 159.26M |
Balance Sheet | ||||||
| Total Assets | 2.75B | 2.04B | 1.64B | 1.68B | 935.07M | 956.42M |
| Cash, Cash Equivalents and Short-Term Investments | 1.44M | 5.38M | 3.75M | 7.97M | 4.29M | 4.24M |
| Total Debt | 2.22B | 1.89B | 1.72B | 1.68B | 919.85M | 1.02B |
| Total Liabilities | 2.72B | 2.01B | 1.80B | 1.79B | 1.04B | 1.06B |
| Stockholders Equity | 31.99M | 35.53M | -161.87M | -110.70M | -103.99M | -108.30M |
Cash Flow | ||||||
| Free Cash Flow | -56.84M | 77.30M | 124.97M | 45.47M | 251.15M | 179.73M |
| Operating Cash Flow | 217.26M | 206.34M | 225.32M | 192.17M | 275.16M | 193.02M |
| Investing Cash Flow | -720.28M | -384.58M | -89.63M | -770.44M | -16.36M | -123.14M |
| Financing Cash Flow | 499.35M | 179.87M | -139.91M | 581.95M | -258.75M | -71.18M |
Delek Logistics Technical Analysis
Positive
45.39
Price Trends
44.32
Positive
43.55
Positive
41.35
Positive
Market Momentum
0.12
Negative
58.53
Neutral
88.09
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DKL, the sentiment is Positive. The current price of 45.39 is above the 20-day moving average (MA) of 44.42, above the 50-day MA of 44.32, and above the 200-day MA of 41.35, indicating a bullish trend. The MACD of 0.12 indicates Negative momentum. The RSI at 58.53 is Neutral, neither overbought nor oversold. The STOCH value of 88.09 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DKL.
Delek Logistics Peers Comparison
UnderperformOutperform
Sector (65)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| ― | $7.11B | 12.56 | 52.91% | 8.40% | 9.02% | 17.28% | |
| ― | $13.50B | 10.77 | 16.43% | 6.35% | 17.92% | 18.39% | |
| ― | $2.42B | 15.35 | ― | 9.76% | -12.08% | 1.44% | |
| ― | $11.79B | 18.53 | 8.34% | 8.62% | -4.31% | -17.80% | |
| ― | $15.17B | 7.61 | 4.09% | 5.20% | 3.87% | -62.32% | |
| ― | $26.33B | 13.15 | 112.19% | 6.12% | 10.62% | 5.04% | |
| ― | $418.49M | ― | -25.85% | ― | 2.91% | -432.03% |
* Energy Sector Average
DKL
Delek Logistics
45.39
11.21
32.80%
CQP
Cheniere Energy Partners
53.44
7.07
15.25%
PAA
Plains All American
16.91
1.45
9.38%
SMC
Summit Midstream
21.65
-12.76
-37.08%
VNOM
Viper Energy
37.18
-11.30
-23.31%
HESM
Hess Midstream Partners
33.72
1.34
4.14%
Delek Logistics Corporate Events
Delek Logistics Partners Reports Strong Earnings Call
Aug 7, 2025
The recent earnings call for Delek Logistics Partners was marked by a largely positive sentiment, underscoring the company’s strong financial performance and strategic achievements. Despite a minor decrease in the Wholesale Marketing and Terminalling segment’s EBITDA, the overall tone was optimistic, reflecting the company’s robust growth and strategic initiatives.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.