Delek Logistics (DKL) Ups Quarterly Cash Distribution by 5% Y/Y
Delek Logistics Partners, LP DKL has announced that it will pay cash distribution of $1.035 per common limited partner unit for the second quarter of 2023. This represents a 1% sequential increase and a 5.1% rise from the year-ago figure. The revised quarterly distribution is payable on Aug 14, 2023, to unit holders of record on Aug 7, 2023.
The company’s new annualized distribution rate will be $4.14 per unit, resulting in a dividend yield of 9.2%. The current dividend yield is better than the Zacks S&P 500 composite’s 1.61%. Delek Logistics aims to maintain an attractive distribution growth profile over the long term. The firm has set a distribution growth guidance of 5% for full-year 2023.
Can We Expect Hikes in the Coming Years?
The firm provides services to its customers through long-term fee-based contracts with minimum volume commitments or long-term dedicated acreage agreements that mitigate most of its short-term financial risk. So this assures Delek Logistics of steady earnings.
DKL’s acquisition of the Delaware Gathering in June 2022 for $628.3 million boosted its earnings and production. It increased the firm’s exposure to the highly economic Delaware basin, resulting in commodity and geographic diversification.
Delek Logistics is also benefiting from rising production volumes in the Permian Basin due to its existing midstream operation in the region. As volumes are rising, the firm will further increase its operation in the region to capitalize on the increasing demand for midstream services.
The arrangements will assist Delek Logistics in generating stable cash flow and support management in carrying on with cash distribution initiatives.
Price Performance
Over the past three months, Delek Logistics’ shares have lost 4% against the industry’s growth of 4.6%.
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Zacks Rank & Key Picks
Delek Logistics currently carries a Zacks Rank #5 (Strong Sell).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Some better-ranked stocks in the same sector are Murphy USA Inc. MUSA, Crestwood Equity Partners LP CEQP and NextDecade Corp. NEXT, each carrying a Zacks Rank #2 (Buy) at present.
The Zacks Consensus Estimate for Murphy’s 2023 earnings per share (EPS) has moved up 7.5% in the past 60 days. The stock boasts a four-quarter average earnings surprise of 15.56%.
The Zacks Consensus Estimate for Crestwood’s 2023 earnings per unit indicates an increase of 510.3% over 2022’s reported figure. CEQP stock has gained 7.5% in the past year.
The Zacks Consensus Estimate for NextDecade’s 2023 EPS indicates an increase of 23.1% over 2022’s reported figure. The bottom-line estimates have moved up 20.6% in the past 60 days.
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Delek Logistics Partners, L.P. (DKL) : Free Stock Analysis Report
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