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Delek (DK) Stock Rises 7.1% on Account of Narrower Q4 Loss
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Shares of Delek US Holdings, Inc. (DK - Free Report) have gone up 7.1% since the fourth-quarter 2021 earnings release on Feb 23.
This upward stock movement could be attributed to Delek posting a fourth-quarter loss narrower than the Zacks Consensus Estimate.
Behind the Earnings Headlines
Delek’s fourth-quarter 2021 results recently reported an adjusted loss of 61 cents a share, narrower than the Zacks Consensus Estimate of a loss of 80 cents. The bottom line was substantially better than the year-ago quarter’s loss of $2.77 per share, attributable to stronger-than-expected contributions from its refining segment. The margin from the refining unit was $32.1 million, outpacing the Zacks Consensus Estimate of $25 million.
Quarterly revenues of $3.1 billion compared favorably with the year-ago sales of $1.89 billion and surpassed the Zacks Consensus Estimate of $2.77 billion.
Segmental Performances
Refining: DK reported a positive margin of $32.1 million for this segment against a negative $82 million in the year-ago quarter. Moreover, the adjusted margin of $36.9 million rebounded from -$126.9 million in the year-ago period. Results improved primarily due to increased demand, attributable in part to low clean product inventories, and improving crack spreads.
Logistics: This unit represents Delek’s majority interest in Delek Logistics Partners, L.P. (DKL - Free Report) , a publicly traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets. The Logistics unit’s margin of $66.6 million was higher than the year-ago period’s figure of $62.2 million. This improvement was led by the higher utilization of assets supporting refineries and West Texas Wholesale.
Retail: The margin for the unit, which was formed by the acquisition of Alon USA Energy in 2017, rose about 20.5% to $15.3 million from the year-earlier quarter’s level of $12.7 million. Delek’s merchandise sales of $75.5 million with a margin of 33.6%, on average, compared unfavorably with $75.9 million sales, carrying a margin of 30.1%, on average, in the prior year. Its retail fuel gallon sale totaled 42.3 million in the December quarter of 2021, the average margin being 30 cents per gallon. This compared favorably with 41.5 million sales, the average margin being 33 cents per gallon in the fourth quarter of 2020.
Delek US Holdings, Inc. Price, Consensus and EPS Surprise
Total operating expenses incurred in the quarter increased about 42% from the prior-year period’s level to $3,118.7 million.
In the reported quarter, Delek spent $65.5 million on capital programs (60.5% on the Refining segment). As of Dec 31, 2021, DK had cash and cash equivalents worth $856.5 million and long-term debt of $2,125.8 million, with debt to total capital of about 70%.
Guidance
Delek projects first-quarter 2022 total operating expenses in the $160-$170 million band, while the total crude throughput is estimated in the 275,000-285,000 barrels per day range.
For full-year 2022, Delek anticipates capital expenses of around the $250-$260 million range on a gross basis, including $112 million of spending on discretionary and business development projects, out of which about $59 million belongs to the logistics segment.
Zacks Rank & Key Picks
Delek currently has a Zacks Rank #3 (Hold). Some better-ranked players from the energy space are Marathon Oil Corporation (MRO - Free Report) and Centennial Resource Development, Inc. , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Oil reported a fourth-quarter 2021 adjusted net income of 77 cents per share, comprehensively beating the Zacks Consensus Estimate of 55 cents. As of 2021 end, Marathon Oil had 1,106 million oil-equivalent barrels in net proved reserves, suggesting a year-over-year increase of 14%.
Marathon Oil’s earnings for 2022 are expected to soar 83.4% year over year. In good news for investors, the company is using the excess cash from a supportive environment to reward them with dividends and buybacks. As part of that, MRO has executed $1 billion of share repurchases since October (with $1.7 billion remaining under the current authorization) and recently announced a dividend hike.
Centennial Resource reported fourth-quarter 2021 adjusted earnings of 39 cents per share, beating the Zacks Consensus Estimate of 30 cents. Centennial Resource announced its proved reserves for 2021 end at 305 MMBoe, representing growth from 299 MMBoe at the end of the prior year.
Centennial Resource is expected to see earnings growth of 94.2% in 2022. CDEV announced the launch of its stock repurchase program of $350 million. The authorization of the plan is for two years.
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Delek (DK) Stock Rises 7.1% on Account of Narrower Q4 Loss
Shares of Delek US Holdings, Inc. (DK - Free Report) have gone up 7.1% since the fourth-quarter 2021 earnings release on Feb 23.
This upward stock movement could be attributed to Delek posting a fourth-quarter loss narrower than the Zacks Consensus Estimate.
Behind the Earnings Headlines
Delek’s fourth-quarter 2021 results recently reported an adjusted loss of 61 cents a share, narrower than the Zacks Consensus Estimate of a loss of 80 cents. The bottom line was substantially better than the year-ago quarter’s loss of $2.77 per share, attributable to stronger-than-expected contributions from its refining segment. The margin from the refining unit was $32.1 million, outpacing the Zacks Consensus Estimate of $25 million.
Quarterly revenues of $3.1 billion compared favorably with the year-ago sales of $1.89 billion and surpassed the Zacks Consensus Estimate of $2.77 billion.
Segmental Performances
Refining: DK reported a positive margin of $32.1 million for this segment against a negative $82 million in the year-ago quarter. Moreover, the adjusted margin of $36.9 million rebounded from -$126.9 million in the year-ago period. Results improved primarily due to increased demand, attributable in part to low clean product inventories, and improving crack spreads.
Logistics: This unit represents Delek’s majority interest in Delek Logistics Partners, L.P. (DKL - Free Report) , a publicly traded master limited partnership that owns, operates, develops and acquires pipelines and other midstream assets. The Logistics unit’s margin of $66.6 million was higher than the year-ago period’s figure of $62.2 million. This improvement was led by the higher utilization of assets supporting refineries and West Texas Wholesale.
Retail: The margin for the unit, which was formed by the acquisition of Alon USA Energy in 2017, rose about 20.5% to $15.3 million from the year-earlier quarter’s level of $12.7 million. Delek’s merchandise sales of $75.5 million with a margin of 33.6%, on average, compared unfavorably with $75.9 million sales, carrying a margin of 30.1%, on average, in the prior year. Its retail fuel gallon sale totaled 42.3 million in the December quarter of 2021, the average margin being 30 cents per gallon. This compared favorably with 41.5 million sales, the average margin being 33 cents per gallon in the fourth quarter of 2020.
Delek US Holdings, Inc. Price, Consensus and EPS Surprise
Delek US Holdings, Inc. price-consensus-eps-surprise-chart | Delek US Holdings, Inc. Quote
Financials
Total operating expenses incurred in the quarter increased about 42% from the prior-year period’s level to $3,118.7 million.
In the reported quarter, Delek spent $65.5 million on capital programs (60.5% on the Refining segment). As of Dec 31, 2021, DK had cash and cash equivalents worth $856.5 million and long-term debt of $2,125.8 million, with debt to total capital of about 70%.
Guidance
Delek projects first-quarter 2022 total operating expenses in the $160-$170 million band, while the total crude throughput is estimated in the 275,000-285,000 barrels per day range.
For full-year 2022, Delek anticipates capital expenses of around the $250-$260 million range on a gross basis, including $112 million of spending on discretionary and business development projects, out of which about $59 million belongs to the logistics segment.
Zacks Rank & Key Picks
Delek currently has a Zacks Rank #3 (Hold). Some better-ranked players from the energy space are Marathon Oil Corporation (MRO - Free Report) and Centennial Resource Development, Inc. , each presently sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Marathon Oil reported a fourth-quarter 2021 adjusted net income of 77 cents per share, comprehensively beating the Zacks Consensus Estimate of 55 cents. As of 2021 end, Marathon Oil had 1,106 million oil-equivalent barrels in net proved reserves, suggesting a year-over-year increase of 14%.
Marathon Oil’s earnings for 2022 are expected to soar 83.4% year over year. In good news for investors, the company is using the excess cash from a supportive environment to reward them with dividends and buybacks. As part of that, MRO has executed $1 billion of share repurchases since October (with $1.7 billion remaining under the current authorization) and recently announced a dividend hike.
Centennial Resource reported fourth-quarter 2021 adjusted earnings of 39 cents per share, beating the Zacks Consensus Estimate of 30 cents. Centennial Resource announced its proved reserves for 2021 end at 305 MMBoe, representing growth from 299 MMBoe at the end of the prior year.
Centennial Resource is expected to see earnings growth of 94.2% in 2022. CDEV announced the launch of its stock repurchase program of $350 million. The authorization of the plan is for two years.