Delek logistics partners EVP/CFO buys $151k in company stock

In a recent transaction on August 22, Reuven Spiegel, the Executive Vice President and Chief Financial Officer of Delek Logistics Partners, LP (NYSE:DKL), purchased shares of the company's stock. The acquisition, involving 3,885 common units, was executed at an average price of $38.976 per share, amounting to a total investment of $151,421.

This move by Spiegel has increased his direct ownership in the company to 20,163 common units following the transaction. The purchase demonstrates a commitment by the executive to the company's future, as insider transactions are often seen as a reflection of an individual’s confidence in the company's prospects.

Delek Logistics Partners, LP, a master limited partnership, is known for its focus on owning, operating, acquiring, and constructing pipelines and other logistics assets. The company is engaged in the transportation and storage of crude oil and refined products.

Investors and market watchers often pay close attention to insider transactions, as they can provide insights into how the company's leadership views the stock's valuation and future performance. However, it is important to consider a broader range of factors when evaluating the implications of such insider activities.

The details of this transaction were made public through a Form 4 filing with the Securities and Exchange Commission, which was submitted on August 26.

In other recent news, Delek Logistics Partners reported record second-quarter earnings, with an adjusted EBITDA of $102.4 million. The company announced several strategic transactions aimed at enhancing its market position, including an extended contract with DK, the Wink to Webster pipeline, a new gas processing plant investment, and the acquisition of H2O Midstream. The Board of Directors approved an increase in the quarterly distribution to $1.09 per unit, reflecting the company's strong performance and commitment to delivering value to its unitholders.

These recent developments are expected to strengthen Delek Logistics Partners' position in the Permian Basin and enhance asset quality. The company's leverage improved, with a ratio of 3.81 times at the end of Q2, down from 4.84 at the end of the previous year.

Looking ahead, the majority of Delek Logistics Partners' EBITDA is projected to come from non-related parties by the first half of 2025, making it a mostly independent midstream company. The new gas processing plant is highly subscribed and is expected to generate cash on cash returns of more than 20%, with completion targeted for the first half of 2025.

In the Q&A session, Avigal Soreq, President of Delek Logistics Partners, discussed the comprehensive suite of services that will improve future customer opportunities and operational efficiency. The funding for the transactions will be managed efficiently, with a tax-efficient exchange of units between companies and the proper allocation of assets under the right ownership.

InvestingPro Insights

The recent insider purchase by Reuven Spiegel, Executive Vice President and CFO of Delek Logistics Partners, LP, aligns with several positive signals observed in the company's financial metrics and market performance. As of the last twelve months leading up to Q2 2024, Delek Logistics showcases a strong financial standing with a market capitalization of approximately $1.83 billion and a P/E ratio of 13.35, which slightly adjusts to 12.88 when considering the latest metrics. These figures suggest a company that is valued reasonably in relation to its earnings.

InvestingPro Tips highlight that Delek Logistics has raised its dividend for 11 consecutive years and has maintained dividend payments for 12 consecutive years, which may appeal to income-focused investors. The company's significant dividend yield of 11.19% stands out, especially considering the broader market environment. This commitment to returning value to shareholders could be a strong indicator of the company's financial health and management's confidence in its future prospects.

In terms of performance, the company has experienced a quarterly revenue growth of 7.18% in Q2 2024, reflecting a positive short-term business trajectory. Additionally, the company's stock has been identified as trading near its 52-week low, which might present a buying opportunity for investors seeking value stocks. It's also worth noting that analysts predict the company will remain profitable this year, which is corroborated by the company being profitable over the last twelve months.

For those interested in further insights and additional InvestingPro Tips, there are 9 more tips available for Delek Logistics on the InvestingPro platform that could provide a deeper understanding of the company's stock performance and financial health.

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