On November 13, Boston-based Callodine Capital Management disclosed a complete exit from Delek US Holdings (DK +0.33%), reflecting a $15.19 million position reduction.
What Happened
According to a U.S. Securities and Exchange Commission (SEC) filing dated November 13, Callodine Capital Management, LP fully liquidated its position in Delek US Holdings (DK +0.33%) during the third quarter. The fund sold all 717,245 previously held shares, exiting a stake that accounted for 1.57% of its assets as of the prior quarter. The estimated value change for the quarter was $15.19 million.
What Else to Know
Top holdings after the filing:
- NYSE:SPB: $90.09 million (7.9% of AUM)
- NYSE:WWW: $74.13 million (6.5% of AUM)
- NASDAQ:VTRS: $68.72 million (6.0% of AUM)
- NYSE:OWL: $66.07 million (5.8% of AUM)
- NYSE:EQH: $52.95 million (4.6% of AUM)
As of Wednesday, DK shares were priced at $29.66, up 60% over the past year and well outperforming the S&P 500, which is instead up about 16% in the same period.
Company Overview
| Metric | Value |
|---|---|
| Revenue (TTM) | $10.67 billion |
| Net Income (TTM) | ($514.90 million) |
| Dividend Yield | 3% |
| Price (as of Wednesday) | $29.66 |
Company Snapshot
- Delek US Holdings produces and markets refined petroleum products, including gasoline, diesel, aviation fuel, and asphalt, and operates convenience retail stores and biodiesel facilities.
- The company generates revenue primarily through refining operations, logistics services for crude oil and refined products, and retail fuel and merchandise sales.
- It serves oil companies, independent refiners and marketers, jobbers, distributors, utility and transportation companies, the U.S. government, and independent retail fuel operators.
Delek US Holdings, Inc. is an integrated downstream energy company with a diversified portfolio spanning refining, logistics, and retail operations. The company leverages its network of refineries and distribution assets to supply a broad range of petroleum products and services across multiple channels. Its strategic presence in the southern and central U.S. markets, combined with vertical integration, enables Delek to serve a wide customer base and adapt to changing market dynamics in the energy sector.
Foolish Take
Selling during a big rally suggests this fund chose to lock in gains and look elsewhere for opportunities. That decision fits the broader profile of the portfolio, which skews toward opportunistic, valuation-driven positions rather than long-duration bets on commodity-linked earnings streams.
Delek’s recent results underline why that discipline matters. The firm turned a $178 million profit in the last quarter, compared to a $76.8 million loss one year earlier, though that was largely related to a $280.8 million benefit from government exemptions. While the company continues to benefit from its vertically integrated model across refining, logistics, and retail fuel, earnings remain tightly tethered to regional fuel demand. Meanwhile, management has leaned on logistics stability and asset optimization, but those strengths do not fully insulate cash flows when refining margins compress or volatility returns to energy markets.
Compared with the fund’s remaining holdings, which tilt more toward consumer, financial, and asset-light businesses, Delek stands out as capital-intensive and inherently cyclical. For long-term investors, this doesn’t necessarily mean Delek is broken -- at all. But it does suggest that returns are likely to be lumpy, driven by timing, margins, and capital discipline rather than steady compounding.
Glossary
Assets Under Management (AUM): The total market value of investments managed on behalf of clients by a fund or firm.
13F: A quarterly report filed by institutional investment managers disclosing their U.S. equity holdings.
Liquidated: The process of selling all holdings in a particular investment, reducing the position to zero.
Downstream: Refers to the refining, distribution, and sale of finished petroleum products to end users.
Vertical Integration: A business strategy where a company controls multiple stages of production or distribution within its industry.
Dividend Yield: A financial ratio showing how much a company pays in dividends each year relative to its share price.
Logistics Services: Services related to the transportation, storage, and distribution of goods, such as crude oil and refined products.
Jobbers: Independent wholesalers who buy petroleum products and resell them to retailers or end users.
Outperforming: Achieving a higher return or growth rate compared to a benchmark, such as the S&P 500.
Stake: The ownership interest or investment a person or entity holds in a company.
TTM: The 12-month period ending with the most recent quarterly report.
