Delek US Holdings, Inc. (DK)

[jugs]

It may just mean a lot to those considering taking a position in DK.

[pete807]

What's the difference in the end?

[jugs]

R U sure they were a myrh?

Tastes more like a lie to me.

This company does little to merit praise from me.

[pete807]

The market has chosen this stock to bet against, while the insiders just raised their personal ATM (MLP) 64+% Insider owned distribution w/ DKL to $.81. for 11% yield.

Major Holders

64.49% % of Shares Held by All Insider
23.99% % of Shares Held by Institutions
67.57% % of Float Held by Institutions
59 Number of Institutions Holding Shares

Drop downs from ALDW were a myth...

[jugs]

This board lists just 10 followers, something I hadn't even known for many months now. As I contemplate selling off my 60 0r so shares, I look for redeeming factors that might sway me one way or another.

Ten followers? Nothing could say more about public confidence in this company's failure in honoring shareholders. Retail support is virtually nil.

I'll be selling my remaining shares on any rebound from here with $32 the logical target.

[jugs]

I'll probably let go of my last 61 shares next week. I'm in kill mode---divesting myself of anything failing to pay off in reasonable time.

CLDR is doing incredibly well for me, btw.

[pete807]

DK may get back to $40+ but...
Bigger fish to fry....
I am moving a bit of remains of a good investment on to where the prospects appear better.
Good luck to all who venture with this beaten down stock. Their earnings are NOT what is holding them back.

I will continue to monitor the progress and moderate here.

-pete

[pete807]

Dumb strategy.. what do you suspect they are hiding? It does not appear to be working.

They should brag instead, as SEC says they are granted much latitude...

[jugs]

Yes, I know well the value of effective IR. But I also know very well that companies NOT communicating are deliberately hiding.

[pete807]

True enough but if you don't fear the shorts and wait them out.. you get to experience the flip side.
They will move on and pick a new one when numbers reveal strong fundamentals, regardless of insider advantage.

If DK has money to burn and grows the company wisely the disconnect with price, cash flow, and earnings with take care of itself. I don't see a struggling company. Just a company that could communicate a whole lot better with the investors, and I don't just mean us little retail guys. .I gotta believe it is systemic and big players are not hearing either. You know from experience the value of IR.

[jugs]

You're probably right about how people will ignore companies with strong profits and sizable production results but of what value are these when only management comes out improved?

[pete807]

Ah but I was copying a word you ignored... good , so I had to speak to myself, lol, but you know who the reply was meant for cuz you trim those silver sideburns.

It is, however funny that people here are so consumed by companies with no product or revenue but ignore companies with millions of dollars flowing through their hands.

A good idea for a copy would be Ehub, no? we could even let tree huggers in!

Just how big is the mid stream energy sector? 10 places ahead of any decimal....

[jugs]

Pietro---

You appear to be consumed by discussion with yourself.

I know a fine psychologist, by the way.

[pete807]

LOL. I know you spoke with the person who they put in place to handle calls back when we questioned the theft of distributions. (I won't call it IR cuz those relations imply and are supposed to be good!)
I spoke with the SEC who said they let them do what they want to. :O(
I thought you did not have an investment here?
I should have said does anyone have anything bad to add... Tell me what you really think of DK.

good

And after your post the shorts jumped on it again...
Don't assume they alone can kill DK, cuz numbers mean capital for more swallowing. We shall see as I am entertained by the tiny amount it matters to my account.

[jugs]

Yeah, I've got something to add...


This %*^&#)(@$#+! of a company is worth every bit of the mix of electrons you're reading my message on.

Smart money knows this is a BS-based company swallowing other companies as they become available. Delek knows damned well they don't communicate---it's part of their game to withhold information that could empower shareholders...better to keep everyone in the dark---easier to operate without retail chumps like me sitting on their shoulders.

What we're seeing is what we get. This is possibly the lowest grade investment vehicle I've got out of fifteen picks.

[pete807]

This heavily shorted company is trading at a forward P/E multiple of 7 and will earn over $1 per share when they announce next month. Favor here has never been lower! Some news of what they do with all the cash could bring about a change IF it is positive for their investors.

I hold a small position and will exit when the inevitable squeeze comes. I have been disappointed with DK since before they took over ALDW.

The problem I see is they are terrible at communicators. Management is totally out of touch with their investors,... giving no positive press releases about their confidence or where they are steering the company. Their 3% dividend would even be a lot lower at a normal P/E multiple, meaning the bottom line is, investing in the safety of US treasury bonds wins here. Gamblers might be better buying a fraction of a share in a FAANG company, lol. Their logistic MLP DKL is just a private ATM for insiders. DK has been a favorite of the shorts.

As a former unit holder in the MLP (ALDW) they swallowed to boost their cash I took 95% of the cash out early in the forced switch to DK. Only hold a bit now in an I RA I never trade. This will change soon either way.

If anyone has anything good to add here please post it!
-pete

[jugs]

Been sick and sleeping all day. Just now looked at my portfolio and see we're doing well with 40 min. left. Hope things hold up.

[pete807]

GM ... did you get an email from our friend predicting again a 14 by feb for our other energy play...I should move the Wells DK C corp shares to that MLP... :o) however, ...
I am also looking at my favorite old leveraged REIT that pays big this month if I buy this week, ex 11th.

[jugs]

Excellent commentary!

[pete807]

You see that because you were an ALDW investor, however I would wager that has no bearing on the leap you made that their flaw stems from beating us ALDW investors out of some earned distribution....
You know I was in that group, but won't let my disdain for that transaction prevent making money on their stock if it is undervalued, as it is, imo. There are better plays to move the money to when the short attack ends... (over 7% of the float at the moment, so I will be glad to move the tiny stake left in DK to another stock). If earnings beat again I bet there is a squeeze that hands me an extra $1000.

Furthermore since ALDW was a great cash producer which is now a part of DK it is more about the sympathy with crude and refining spreads driving this short attack to 7% of the float,... much more than disgruntled independent ALDW investors, (a relative tiny group with no power to move DK), DK traded in the mid $11's in June July of 2016. only $20 August 1 of 2017, when they had their last missed earnings. Since oil fell independent refiners are also down. Their 3 year chart actually looks much like many in energy. Even outside the independent refining sector.

Where is abject failure? They just failed to pay us independent ALDW holders the final distribution. The institutions got heads up the merger was coming... When all the chips are in even my record will be very good with DK's contribution to investment gains! They were already booked in 2018.

I am not changing my dislike for their ethics relating to our MLP they swallowed, but not worried their running their business into the ground... They are currently undervalued. They are certainly not the only energy company in that predicament.

For the record, I moved more than 95% of the investment to a better yielding space which is also undervalued in the energy sector. My post alluded to the small stake in an IRA account I don't trade much.

I am not arguing the case to buy DK, nor sell it here.

[jugs]

I'm seeing an enormous flaw here:

DK repurchases aggressively their open market commons while shares simultaneously drop from $62 to less than half in the same time period. That's far worse than any other stock I've known and covered.

The reasoning behind repurchases is that of bringing things into line. They've accomplished nothing positive save for alienating ALDW investors.

I think it ludicrous to have cash placed into DK's hands knowing their history speaks to abject failure.

[pete807]

I don't have a big position so I a not worried about this drop... I believe just like others DK will weather the bear attack, because I have looked over their numbers and free cash flow is very good. Of course we know their advantages as we held them a long time to OUR advantage.

They will continue a string of beats with earrings imo, and have increased their payout, while still being on the too conservative side, I dont care in their case cuz it's the appreciation when the cycle returns I am holding for. Upside has NOT gone away with the drop, quite the opposite imo. I see their buy backs are to be envied, (Repurchased approximately $365 million of DK shares in 2018), as is their net debt to cash metric... (see page 11 of the link) so a squeeze would not surprise.
link:https://delekus.gcs-web.com/static-files/9dfb1104-23b9-4eb0-965d-e4fdbee8f8c3
GLTA!
-pete

[jugs]

DANG!!!

Dealing with a lot of things unrelated to my usual market activity, I'm first getting to see DK now as this Tuesday's trading session is poised just 25 minutes from the close.

DK now stands at $31.39.


WOW! It has me wondering is management even has a clue as to how they might remedy its mismanagement at a time that has oil on the rise with improving fundamentals?


AH doesn't refer to only after-hours.

[jugs]

Today we energy guys are flying higher and higher while DK is suffocating.

The downward targeting from above $60 to a top of $38 doesn't bode well, obviously. However, I'm thinking $38 is on the high end and I expect revisions sinking closer towards the $33-$34 range.


This results from managerial flaws and not from America's need for refined products. I view the company as catering to grasping for more of the usual public focus-related items but failing to appeal to shareholder concerns.

There's an interesting dichotomy in that as it's the shareholders DK ought to be focusing on and not trying to curry favor solely in the broader investment community. The community is supporting the company! How stupid!


This is so dumb I can't believe I'm the only one saying it yet I may be.

[pete807]

Could it be that investors are seeing the spread widening between WTI and Brent?

We are under $50 and Brent is over $60! Spread was that large earlier this year too but both prices were much higher...

Dec1 2016 spread was $5

Remember the days of good spreads and the ALDW, NTI cash generation?

The spread was just the $5 cost of tanker shipping to overseas refiners when we first repealed the export ban.

Yes, the US refiners lost much of that advantage they had when we banned export.

Production is bringing that advantage home.....

[jugs]

No argument here, really.

DK stinks and I don't like the stench, it's that simple. If I'm making money, to Hell with tax consequences, my CPA takes care of things. Plain and simple- I don't want to fuss over taxes whether we're talking about a thousand $$ or more.

Minimizing your taxability us important to you. I get it.

[pete807]

I have explained it more than once but we do think differently on taxes... and we live in different places where there are more local and state taxes charged...

I don't need taxable gains this year. In January I can take them to deal with 15 months later if needed.
Depending on performance I will hold or sell but I disagree on DK selling me out cause they did that already so I have thousands of gains to deal with automatically in April due to the change away from the MLP consummated in February. We had no choice and some of the gains since the merger are unrealized so I will wait.

I see DK only as an opportunity to make money based on high earnings, I know there is not much yield via dividend but... Even at $40 I retain unrealized gains that would cost me over a thousand dollars in April. I choose to wait and see. This company has earnings beats and lots of cash flow, and is generally undervalued like some others we know. Should they choose to acquire assets the market might like them even more in 15 months. I will have booked any gains and dealt with the taxation.

I stick to my plan cuz it works.

[jugs]

The market is operating as it has for decades. It is not suddenly doing things differently. Sure, machines are doing things humans formerly did but nobody is pumping gas for me now so why should we expect anything different in the market?

DK will move only when certain forces think it should and then they'll take steps to guarantee their wishes will be self-fulfilling. It's how they make money

Where you and I differ is in being able to accept the degree of crookedness we both see. Some of us see it as same old, same old while others argue and protest. Same old should be killed off and allowed to rest in peace.

Clinging to stocks controlled by money bigger than we are is usually fruitless. Money I've taken out of DK shares is making profits in NGL.

DK is an awful pick, not deserving of my consideration. I know we agree that management will sell us all out eventually.

Why wait?

[TNMopar]

I'm waiting this one out too Pete. I think it's just a matter of time. Most all petroleum stocks have taken a big hit. I didn't think I'd see VLO back in the low 70's again but here it is.

[pete807]

Absolutely! The market has been taken over by robots! No one can trust logic anymore. No amount of research and chart dissection matters either. It's a different world.

[jugs]

Oooooooops!

It's back to napping for DL.

The problem for me at this juncture is that while I like seeing momentum reversing the negative bias we've been seeing for a long time now, I'm not confident I can assess momentum changes based on hours or even a week with any degree of accuracy. So much that we see is not worthy of being trusted at all. I'm looking very intently over my shoulder every step of the way.

[pete807]

DK is waking up from it's nap... :o)

[pete807]

I don't need to like the ruthless management to like the earning potential of my investment here... So I may add to my small stake as I agree with this article.
https://seekingalpha.com/article/4223219-delek-us-holdings-offers-far-sighted-investors-return-50-percent-q4-2019

The fact that its net debt (total debt minus cash) is declining shows that its purchase of peer Alon USA Energy is already delivering large returns.

We knew they were stealing a golden goose, so I am rethinking the fall from $60 here and will ride the golden eggs back to $50 or better. I like the $560 MM share buyback also.

The company announced a new $500 million buyback authorization as part of its Q3 earnings report that brings its total authorization to $560 million. It intends to repurchase $150 million worth of its shares in Q4 alone

-pete

[jugs]

For me the trick was to generate a $500 or better gain weekly. It was easy for the most part but far more than that was the great fun I got from working my deals.

It's a hobby you could start with just $5,000.....never spending the whole "seed." That way you get to live another day.

[pete807]

Seems if you buy end of day or first thing on a fast drop at open, which we see a lot in many of the energy plays, ... then sell the predicable high middle of the day here in CDT, you could day trade 4-5 hours and have plenty of lunch money, lol.

Maybe we could write a counter algo - rhythmic program for fun if either was a programmer.

[jugs]

As a rule, DK will rise in early morning and then fall back. Sometimes it will resume an upward bent but typically falls back into the close. You're definitely correct about the wide spreads. A day trader could make easy money here and have fun playing the odds. That's what I did for years, using stocks like DK as the bait.

Lots of fun and highly profitable.

[jugs]

I've sold at $38 all the way up to around $58 or slightly better but I didn't do astoundingly well in terms of catching the highs. I am satisfied though.

Selling some this week was very good as it enabled my covering IRA liquidity requirements while not sacrificing any NGL holdings. Got about $40 which pleases me. Still holding a few but worth only a grand or so.

[pete807]

If you look at the example of todays trading on DK, it shows me that with no news a company like DK with plus numbers and consistent earning beats, will swing $1 easily during the day on unconnected fear and market sentiment. Algo's get to make money on the way up and down and retail is not well informed or aware of any due diligence... It shows the lack of discovery in the market these days... unrelated speculative fear of something unseen.

The $30 $40, $50, $60 dollar DK shares over the last 6 months have earned money each quarter but you sure would think different if all you saw was what the share price was in that time. $61.50 on JUNE 1st, $34.90 on Oct 26th.

Money was earned in refining at all the different speads and prices of crude too. We know they are making great cash flow all segments & locations, don't have heavy debt burden, ...but one gem in particular close proximity to Permian crude... they didn't have to pay that refinery's partners for the great earnings a year ago did they.

[pete807]

Presentation:
https://delekus.gcs-web.com/static-files/d488a7b0-3d78-41b1-88f5-4af005fe6293
Notice drilled Uncompleted wells reaching 25% (page 7)

[pete807]

Results improved year-over-year primarily due to better performance in the refining segment.

So much for whatever reason the stock was hammered down. Now it is more likely it has to do with Their poor IR style and other company insiders poor communication skills. These guys have to be the root cause as I was always shocked to see it fall so far after such performance based upgrading?

They had to be on short lists... pun intended.

[pete807]

No worries here as it is about the pending opportunity!

I just look at the trading activity and try to figure out what may be a logical next step.

That said I have yet to dig a bit more into their posted numbers,... more in a bit.

[jugs]

Up $3 for a piece of this crud!!!

Methinks people out there don't know what some of us know about management's tending to its fiduciary responsibilities.

Maybe I'm just not the sneaky sort and for that reason don't relate well to this piece of crap.

[jugs]

Hear ye! Hear ye!

The cheapskates at DK just declared a 4% rise in dividend now going to 26 cents. Let's hear it for the added penny!

Wow!

[jugs]

Problem just resolved of itself.

Good to see it!

[jugs]

Yep!

My computer is showing a double view of IHUB. Can't access active links and have to use my phone so please excuse MS. Spellchick.

Anybody else having this problem of one screen bleeding onto another? All other applications are fine, btw.

[pete807]

Great to hear!
I am also pleased as I added during that swoon... I differ only in the source from another sell. Mine was from the sale of the other merger MLP and I was lucky to time it so well. That one remains out of favor as the CEO Kelsey Warren has played a few tricks along the way that do not favor the retail guys like us.

Such a crap shoot.

[jugs]

I held back less than 100 shares of DK. But used the proceeds from selling for buying NGL at $9.60-$9.70---looked it up this morning. Add in the distribution and it means selling DK when I did hands me $2/unit of NGL today. I'm definitely a happy camper.

[pete807]

Hope you held a few as my hunch was we could get a bit back,

$2.45 per share today, but profit taking going on and pulling back from almost %40! So far so good. +6.7% at the moment but I think I will let it churn a day or two.. Then see what I think.

I am going to look at the numbers released now, but Mr Market must like them.

[pete807]

With lofty targets by analysts, earning beats for each of the last few quarters, and booming energy production, this stock should rise on more positive earnings to be announced shortly.

Key for me is what they will do for us investors to improve not only their balance sheet, but their fractured relationship with the community which placed them on the downward trend since their fall from over $60. Was that irrational exuberance? Who can say.

[jugs]

Most of my DK position has now been sold. There are other more promising opportunities out there in my opinion.

Still here and holding a few but very few, mostly out of curiosity.

Best of good fortune to all others reading this board.