Delek US Holdings Added as New Long Idea at Hedgeye

Hedgeye added Delek US Holdings (NYSE:DK) as a new long idea. The EPA is expected to announce a Renewable Volume Obligation (RVO) mandate for 2026-27 by the end of October and must resolve outstanding Small Refinery Exemption (SRE) issues. This is expected to positively impact Delek's operations and financial performance.

Hedgeye Research has added Delek US Holdings (NYSE:DK) to its long idea list, citing potential positive impacts on the company's operations and financial performance following an expected Renewable Volume Obligation (RVO) mandate announcement by the EPA. The EPA is slated to announce the RVO mandate for the 2026-27 period by the end of October, with an expectation that it will resolve outstanding Small Refinery Exemption (SRE) issues beforehand [1].

Hedgeye analyst Fernando Valle noted that while there are several options for the EPA to consider, it is expected to take measures to mitigate the impact on future RINs while providing court-mandated relief to impacted small refiners. Valle expects a favorable resolution could result in material one-time gains (100%) and improvements in profitability for Delek [1].

Shares of Delek (DK) rose 1.6% on Friday following the announcement, reflecting investor optimism about the potential positive impact on the company's financial performance [1]. Delek US Holdings, Inc. (DK) targets a run rate of $130M–$170M in earnings per operating period cash flow uplift by the end of 2025, aiming to advance its DKL separation [2].

InPlay Oil Corp. (TSE: IPO), which recently completed an acquisition of Cardium light oil assets, has seen a 138% increase in adjusted funds flow in Q2 2025, driven by operational efficiency and strategic hedging. InPlay's partnership with Delek Group, which now holds a 32.7% stake, further underscores the potential benefits of Delek's strategic alignment with high-yield energy investments [2].

References:
[1] https://seekingalpha.com/news/4486154-delek-added-as-a-new-long-at-hedgeye
[2] https://www.ainvest.com/news/inplay-oil-dividend-sustainability-strategic-rebalance-income-investors-2508/