Wolfe Research upgrades Delek US stock rating to Outperform on SRE benefits

Published 03/09/2025, 07:00
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Investing.com - Wolfe Research upgraded Delek US (NYSE:DK) from Peerperform to Outperform and set a price target of $40.00.

The upgrade comes as Delek US stock has gained 68% year-to-date, outperforming the XLE benchmark by 64% and recently surpassing its refining industry peers.

Wolfe Research attributes the strong performance partly to the Environmental Protection Agency’s partial grant of small refining exemptions (SREs) to Delek, a benefit that could potentially continue in the future.

The research firm notes that despite recent stock gains following the exemption grants, the market has not fully priced in the precedent established for future benefits, even under a different administration.

Wolfe Research also points out that Delek’s current valuation is dominated by its equity stake in DKL, with the market assigning little value to its refining assets at current mid-cycle crack spreads. According to InvestingPro, the stock appears overvalued at current levels, with 18 additional key insights available to subscribers through the comprehensive Pro Research Report.

In other recent news, Delek US Energy Inc. reported its Q2 2025 earnings, revealing a narrower-than-anticipated loss. The company posted an adjusted earnings per share (EPS) of -$0.56, which was better than the forecasted -$0.86. Revenue for the quarter reached $2.76 billion, surpassing expectations of $2.67 billion. These results highlight the company’s ability to exceed analyst projections on both earnings and revenue fronts. Despite the earnings beat, the stock experienced a decline in pre-market trading. Analysts had anticipated a more significant loss, making the actual results a positive surprise. There were no mentions of mergers or acquisitions in the recent updates. Additionally, no analyst upgrades or downgrades were reported in the latest developments. These recent developments provide investors with crucial insights into Delek US Energy’s financial performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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