One point I dare not ignore, though:
We don't know how DK will recognize ALDW units upon conversion in terms of tax liability. It'd be great if it were as simple as a near 2:1 @.49. But we have no way of knowing there'll be a step up.
Many of us have elected to liquidate half of our previously held ALDW holdings as this limits our tax exposure to 50%. But that may not be how it works. As of this time we can't know. DK may announce that our units of ALDW are to be credited with a value LESS consideration of gains accrued priorly. This would effectively screw those expecting a step up and for this reason I sold half my units.
Half of something is worth more than all of nothing.
Continuing on this path... my sense all week has been that DK would soon be rising, a result of the really fine quarterly report. I immediately started buying and announced so on the board. Over the first three days of this week I built a 2100 share position.
The give-away was the report itself which I studied, knowing my responses would be guiding me as the big swallow is in processing mode and I had to move on things to protect my interests. It was clear there'd soon be analyst upgrades.
It was Tuesday, I believe, when the flurry of analyst announcements landed and I topped off the tank immediately. Later that day Wells Fargo came out with their +47% projection amounting to a $40 share. At that point I felt I had to push people hard or the opportunity would fizzle. So I campaigned and prodded.
My 2100 shares are nearly $2,000 ahead already. Before WF spoke of $40 I'd come up with my own $38-$39 based on studying the quarterly, looking at the prior several years of earnings and capex and especially the fact that the company had been able to execute fairly well despite difficult times in the energy sector.
Adding it all up I figured that while I may be exposing myself to a lot of taxation by selling half of ALDW, that gives me the cash to redeploy in DK. Further, I get to buy DK now on the cheap. When the swallow happens, DK may be several dollars higher in valuation and that might trigger a different accounting procedure affecting the 0.49 basis.
NOT buying into DK now is a mistake in my eyes as I see a rising valuation ahead. Holding ALDW may seem very profitable but January brings a new tax year and I wouldn't want to be in the revolving doors come the first of the year.
A lot of people don't know about DK but this will surely change. Brokerages will promote it as they want their clients to make money and this pick is going to do that.
Waiting to learn the final terms of the swallow and doing nothing is like not living until we know how we will die. This is the ideal time to act! Waiting could quickly add $5 to the cost of a share whereas acting now eliminates concern. At the worst, you'll end up with shares you hadn't considered, shares probably containing unexpected gains while in the womb awaiting the big swallow.
I hope this helps you, please let me know.
Recent DKL News
- Form 10-Q - Quarterly report [Sections 13 or 15(d)] • Edgar (US Regulatory) • 05/08/2024 04:23:36 PM
- Form EFFECT - Notice of Effectiveness • Edgar (US Regulatory) • 05/08/2024 04:15:24 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 05/07/2024 01:01:05 PM
- Delek Logistics Reports First Quarter 2024 Results • Business Wire • 05/07/2024 11:30:00 AM
- Delek Logistics Partners, LP Increases Quarterly Cash Distribution to $1.07 per Common Limited Partner Unit • Business Wire • 04/25/2024 10:13:00 PM
- Delek Logistics Partners, LP Announces Pricing of Offering of $200 Million of Additional 8.625% Senior Notes Due 2029 • Business Wire • 04/12/2024 10:09:00 PM
- Delek Logistics Partners, LP Announces Proposed Offering of $200 Million of Additional 8.625% Senior Notes Due 2029 • Business Wire • 04/12/2024 01:14:00 PM
- Delek Logistics Partners, LP Announces Closing of Public Offering of Common Units and Full Exercise of Underwriters' Option to Purchase Additional Units • PR Newswire (US) • 03/12/2024 09:12:00 PM
- Delek Logistics Partners, LP and Delek Logistics Finance Corp. Announce Results of Tender Offer for Any and All of their Outstanding 6.75% Senior Notes due 2025 • PR Newswire (US) • 03/11/2024 09:27:00 PM
- Form 424B2 - Prospectus [Rule 424(b)(2)] • Edgar (US Regulatory) • 03/11/2024 04:33:10 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 03/08/2024 12:48:53 PM
- Delek Logistics Partners, LP Announces Pricing of Public Offering of Common Units • PR Newswire (US) • 03/08/2024 03:54:00 AM
- Form 424B3 - Prospectus [Rule 424(b)(3)] • Edgar (US Regulatory) • 03/07/2024 09:38:40 PM
- Delek Logistics Partners, LP Announces Proposed Public Offering of Common Units • PR Newswire (US) • 03/07/2024 09:07:00 PM
- Form 424B5 - Prospectus [Rule 424(b)(5)] • Edgar (US Regulatory) • 03/07/2024 09:01:42 PM
- Delek Logistics Partners, LP 2023 K-1 Tax Packages Available on Website • PR Newswire (US) • 03/06/2024 10:29:00 PM
- Delek Logistics Partners, LP Announces Pricing of Upsized Offering of $650 Million of Senior Notes • PR Newswire (US) • 02/29/2024 12:36:00 AM
- Form 8-K - Current report • Edgar (US Regulatory) • 02/28/2024 01:58:53 PM
- Delek Logistics Partners, LP and Delek Logistics Finance Corp. Announce Tender Offer for Any and All of their Outstanding 6.75% Senior Notes due 2025 • PR Newswire (US) • 02/28/2024 01:49:00 PM
- Delek Logistics Partners, LP Announces Proposed Offering of $550 Million of Senior Notes • PR Newswire (US) • 02/28/2024 01:42:00 PM
- Form 10-K - Annual report [Section 13 and 15(d), not S-K Item 405] • Edgar (US Regulatory) • 02/28/2024 01:24:15 PM
- Form 8-K - Current report • Edgar (US Regulatory) • 02/27/2024 03:00:03 PM
- Delek Logistics Reports Fourth Quarter 2023 Results and 2024 Capital Program • PR Newswire (US) • 02/27/2024 12:30:00 PM
- Delek US Holdings Reports Fourth Quarter 2023 Results and 2024 Capital Program • PR Newswire (US) • 02/27/2024 12:00:00 PM
- Delek US Holdings Increases Regular Quarterly Dividend • PR Newswire (US) • 02/20/2024 11:14:00 PM
Avant Technologies Equipping AI-Managed Data Center with High Performance Computing Systems • AVAI • May 10, 2024 8:00 AM
VAYK Discloses Strategic Conversation on Potential Acquisition of $4 Million Home Service Business • VAYK • May 9, 2024 9:00 AM
Bantec's Howco Awarded $4.19 Million Dollar U.S. Department of Defense Contract • BANT • May 8, 2024 10:00 AM
Element79 Gold Corp Successfully Closes Maverick Springs Option Agreement • ELEM • May 8, 2024 9:05 AM
Kona Gold Beverages, Inc. Achieves April Revenues Exceeding $586,000 • KGKG • May 8, 2024 8:30 AM
Epazz plans to spin off Galaxy Batteries Inc. • EPAZ • May 8, 2024 7:05 AM