Trade-Ideas LLC identified

Delek US Holdings

(

DK

) as a "perilous reversal" (up big yesterday but down big today) candidate. In addition to specific proprietary factors, Trade-Ideas identified Delek US Holdings as such a stock due to the following factors:

  • DK has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $15.6 million.
  • DK has traded 69,093 shares today.
  • DK is down 4.5% today.
  • DK was up 8.5% yesterday.

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More details on DK:

Delek US Holdings, Inc. operates as an integrated downstream energy company that operates in petroleum refining, wholesale distribution, and convenience store retailing businesses. The company operates in three segments: Refining, Logistics, and Retail. The stock currently has a dividend yield of 4.7%. DK has a PE ratio of 9. Currently there are 9 analysts that rate Delek US Holdings a buy, no analysts rate it a sell, and 2 rate it a hold.

The average volume for Delek US Holdings has been 1.0 million shares per day over the past 30 days. Delek US has a market cap of $800.5 million and is part of the basic materials sector and energy industry. The stock has a beta of 1.94 and a short float of 4.3% with 2.06 days to cover. Shares are down 43.2% year-to-date as of the close of trading on Wednesday.

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TheStreetRatings.com

Analysis:

TheStreet Quant Ratings

rates Delek US Holdings as a

hold

. The company's strengths can be seen in multiple areas, such as its reasonable valuation levels, good cash flow from operations and largely solid financial position with reasonable debt levels by most measures. However, as a counter to these strengths, we also find weaknesses including poor profit margins, a generally disappointing performance in the stock itself and deteriorating net income.

Highlights from the ratings report include:

  • Net operating cash flow has significantly increased by 91.32% to $99.30 million when compared to the same quarter last year. In addition, DELEK US HOLDINGS INC has also vastly surpassed the industry average cash flow growth rate of -39.19%.
  • DK, with its decline in revenue, slightly underperformed the industry average of 32.6%. Since the same quarter one year prior, revenues fell by 33.1%. Weakness in the company's revenue seems to have hurt the bottom line, decreasing earnings per share.
  • Despite any intermediate fluctuations, we have only bad news to report on this stock's performance over the last year: it has tumbled by 61.09%, worse than the S&P 500's performance. Consistent with the plunge in the stock price, the company's earnings per share are down 76.22% compared to the year-earlier quarter. Naturally, the overall market trend is bound to be a significant factor. However, in one sense, the stock's sharp decline last year is a positive for future investors, making it cheaper (in proportion to its earnings over the past year) than most other stocks in its industry. But due to other concerns, we feel the stock is still not a good buy right now.
  • The gross profit margin for DELEK US HOLDINGS INC is currently extremely low, coming in at 5.94%. It has decreased from the same quarter the previous year. Regardless of the weak results of the gross profit margin, the net profit margin of 1.20% is above that of the industry average.

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