Printed on October twenty eighth, 2025 by Felix Martinez
Excessive-yield shares pay out dividends which might be considerably greater than the market common. For instance, the S&P 500’s present yield is barely ~1.2%.
Excessive-yield shares may be notably useful in shoring up earnings after retirement. A $120,000 funding in shares with a median dividend yield of 5% creates a median of $500 a month in dividends.
Delek Logistics Companions (DKL) is a part of our ‘Excessive Dividend 50’ sequence, which covers the 50 highest-yielding shares within the Positive Evaluation Analysis Database.
We’ve got created a spreadsheet of shares (and intently associated REITs, MLPs, and so on.) with dividend yields of 5% or extra.
You possibly can obtain your free full listing of all securities with 5%+ yields (together with vital monetary metrics similar to dividend yield and payout ratio) by clicking on the hyperlink beneath:
Subsequent on our listing of high-dividend shares to evaluate is Delek Logistics Companions (DKL).
Enterprise Overview
Along with transporting and storing crude oil, Delek Logistics additionally markets, distributes, and shops refined petroleum merchandise for Delek US and third-party prospects. The partnership advantages from secure, fee-based income beneath long-term agreements, which helps cut back publicity to commodity worth volatility. By way of regular enlargement tasks and strategic acquisitions, Delek Logistics continues to strengthen its place within the midstream sector, offering important infrastructure that connects crude oil manufacturing areas with key refining and distribution markets.
Supply: Investor Relations
Delek Logistics Companions reported robust Q2 2025 outcomes, with earnings per share of $1.41—beating estimates by $0.22. Income was $246.35 million, down 6.9% year-over-year and beneath expectations. Web earnings reached $44.6 million, and Adjusted EBITDA rose 18% to $120.9 million. The corporate reaffirmed full-year Adjusted EBITDA steerage of $480–$520 million and introduced its fiftieth consecutive quarterly distribution improve to $1.115 per unit. Delek additionally accomplished the Libby 2 gasoline processing plant in New Mexico and issued $700 million in new debt maturing in 2033, boosting whole liquidity to over $1 billion.
The Gathering and Processing phase led progress, with Adjusted EBITDA climbing to $78 million from $54.7 million final 12 months, pushed by current acquisitions. The Wholesale Advertising and Terminalling phase declined to $23.3 million attributable to a contract reassignment, whereas Storage and Transportation held regular at $16.9 million. Working money movement rose to $107.4 million, and distributable money movement totaled $72.5 million. President Avigal Soreq highlighted plans to develop gas-treating capability on the Libby Advanced and to take care of robust balance-sheet self-discipline. With stable liquidity, constant distribution progress, and bettering money technology, Delek Logistics stays well-positioned for regular midstream enlargement.
Progress Prospects
The corporate has a robust progress outlook, with analysts anticipating distributable money movement (DCF) per unit to rise at a 3.7% annual charge over the following 5 years. Progress will likely be pushed by increasing bitter pure gasoline treating and acid gasoline injection operations, integrating the Gravity Water Midstream acquisition, and pursuing extra strategic offers. These initiatives purpose to extend effectivity, scale, and profitability throughout key U.S. basins whereas supporting regular money movement technology.
The corporate additionally launched a $150 million unit repurchase program to reinforce unitholder worth and preserve monetary self-discipline. Whereas DKL’s payout ratio is at the moment excessive, administration expects distribution progress to path DCF progress to protect flexibility for reinvestment. Backed by a fee-based enterprise mannequin and a robust monitor file of execution, Delek Logistics is positioned for secure and sustainable progress by way of 2030.
Supply: Investor Relations
Aggressive Benefits & Recession Efficiency
Delek Logistics Companions has key aggressive benefits, together with a big midstream community connecting main manufacturing areas to refineries and long-term, fee-based contracts that cut back publicity to commodity worth swings. Latest expansions and acquisitions, similar to Libby 2 and Gravity Water Midstream, additional improve scale, effectivity, and repair capabilities.
The corporate has confirmed resilient in financial downturns, with diversified operations producing secure money movement even when commodity costs fall. Disciplined capital administration and contracted income streams assist preserve distributions and monetary stability, making DKL well-positioned to carry out throughout market cycles.
Dividend Evaluation
Delek Logistics Companions’ annual dividend is $4.46 per share. At its current share worth, the inventory has a excessive yield of 9.8%.
Given the corporate’s 2025 earnings outlook, EPS is predicted to be $5.95 per share. In consequence, the corporate is predicted to pay out 75% of its EPS to shareholders in dividends.
Closing Ideas
Delek Logistics Companions combines a excessive distribution yield, regular progress, and potential valuation enlargement, with distributable money movement per unit projected to develop 3.7% yearly by way of 2030. Strategic acquisitions and infrastructure tasks, together with Gravity Water Midstream and bitter gasoline treating, help its progress and distribution monitor file.
Nonetheless, with an elevated payout ratio and a dividend threat rating of F, distribution progress could also be restricted. Whereas whole returns may attain 15.3% yearly, the corporate is rated a Maintain attributable to this average dividend threat.
Excessive-Yield Particular person Safety Analysis
Different Positive Dividend Sources
Thanks for studying this text. Please ship any suggestions, corrections, or inquiries to [email protected].
