Delek US (DK) Valuation Check After Strong 1-Year Rally and Recent Share Price Pullback
Delek US Holdings (DK) has been on a volatile run lately, with the share price sliding over the past month despite a strong year to date. That disconnect has value focused investors paying closer attention.
See our latest analysis for Delek US Holdings.
Despite that recent pullback, the bigger picture remains impressive, with an 85.47% year to date share price return and a 106.38% one year total shareholder return. This suggests strong but cooling momentum as investors reassess risk and future earnings power at around $34.22 a share.
If Delek’s run has you thinking about what else might be gaining traction, this is a good moment to scan fast growing stocks with high insider ownership for other fast moving, owner aligned ideas.
With analyst targets still sitting well above today’s price, but profits under pressure and growth slowing, investors now face a pivotal question: is Delek US genuinely undervalued, or is the market already pricing in its future recovery?
Most Popular Narrative Narrative: 18.4% Undervalued
With Delek US Holdings last closing at $34.22 versus a narrative fair value near $41.93, the valuation hinges on a delicate balance between thinner margins and richer multiples.
Analysts are assuming Delek US Holdings's revenue will decrease by 1.5% annually over the next 3 years.
Analysts are not forecasting that Delek US Holdings will become profitable in next 3 years. To represent the Analyst Price Target as a Future PE Valuation we will estimate Delek US Holdings's profit margin will increase from -8.0% to the average US Oil and Gas industry of 14.8% in 3 years.
Want to see how falling revenues can still support a higher price? The narrative leans on a dramatic margin reboot and a bold future earnings multiple. Curious which moving part matters most for that upside call? Dive in to uncover the full blueprint behind this fair value.
Result: Fair Value of $41.93 (UNDERVALUED)
Have a read of the narrative in full and understand what's behind the forecasts.
However, the narrative could quickly unravel if hydrocarbon demand erodes faster than expected or if unfavorable refinery regulation sharply compresses margins and cash flow.
Find out about the key risks to this Delek US Holdings narrative.
Build Your Own Delek US Holdings Narrative
If the current story does not quite fit your view, dig into the numbers yourself and craft a custom narrative in minutes, Do it your way.
A great starting point for your Delek US Holdings research is our analysis highlighting 3 key rewards and 3 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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