Delek US Holdings, Inc. (DK) stock intrinsic value fair value estimate & owner earnings analysis

Delek US Holdings owns four refineries in Texas, Arkansas and Louisiana (Tyler, El Dorado, Big Spring and Krotz Springs) with a combined 302,000 barrels a day of crude capacity, plus a 63.3% stake in Delek Logistics, a publicly traded pipeline, terminal and gas-processing partnership. Its retail store business has been reclassified as discontinued operations. Refining profits swing with the gap between crude and fuel prices, so the record is uneven. Our per-share owner earnings (operating cash flow, less working-capital swings, stock compensation and maintenance-level capital spending) were $2.66 in 2018, $2.13 in 2019, $(6.51) in 2020, $(0.48) in 2021, $5.20 in 2022, $1.83 in 2023, $(6.52) in 2024 and $2.87 in 2025. Three of eight years were negative; the median is $1.98 and the simple average is only $0.15. We use the 2018-2025 window because it spans a full cycle: the 2020 collapse, the 2022 peak and the weak 2024. Two accounting judgements matter. First, for 2018-2022 we treat all capital spending as maintenance, because we found no split in those filings and refinery revenue moves with oil prices rather than capacity, which makes a revenue-based split meaningless. For 2023-2025 the company disclosed growth projects, mainly Delek Logistics' gas-processing build-out in the Permian and Delaware Basins (about $252 million in 2025, including $237 million at the partnership), and we excluded those from maintenance. Second, Delek Logistics' cash flows are fully consolidated but 36.7% belongs to outside unitholders, who received $87.1 million in 2025 and $56.8 million in 2024. We deduct about $61 million a year (the 2023-2025 average, roughly $1.00 a share) from owner earnings. Growth path: owner earnings in 2025 rose from a negative 2024 base, so a trailing growth rate is not meaningful. We assume none in year one. No growth is credited in any case: the new 110 MMcf/d gas plant began commissioning in April 2025 and $210 million of 2026 logistics growth spending is budgeted, but returns are not contracted in what we could verify, so they are left out. Operating cash flow for the first half of 2026 was $724 million against a negative $11 million a year earlier, and the last two quarters of 2025 were profitable. That is encouraging but is a cycle print, so we did not lift the anchor. Base case ($12.50 a share): earnings at the median level less the outside-unitholder share, about $0.98 a share a year, flat for 25 years, after which we assume nothing because we cannot name what sustains earnings beyond that. Bear case (negative $6.30): earnings equal the eight-year average including the loss years, about $0.15 before the $1.00 outside-unitholder share, so roughly negative $0.85 a year for ten years. Debt of $3.28 billion (with $630.8 million due in one to three years and $1.94 billion in three to five) and $345.3 million of net interest expense in 2025 make this case credible; the shares appear to owe more than they are worth by roughly $6 a share. Bull case ($28.30): earnings at the average of the four best years in the record (about $3.22 a share, less $1.00), which requires the four refineries to run reliably and the new gas plant to contribute, for 25 years. What would make this wrong: crack spreads staying strong would beat the median, and a sustained weak stretch or a refinancing problem would produce the bear case. Given the cyclicality, leverage and the gap between the median and average, the margin-of-safety price is set well below the base value, near $4 a share.