Head-To-Head Analysis: Delek US (NYSE:DK) and Torm (NASDAQ:TRMD)

Torm (NASDAQ:TRMD) and Delek US (NYSE:DK) are both mid-cap energy companies, but which is the better investment? We will contrast the two companies based on the strength of their dividends, institutional ownership, valuation, profitability, earnings, risk and analyst recommendations.

Analyst Ratings

This is a summary of recent recommendations for Torm and Delek US, as reported by MarketBeat.

	Sell Ratings	Hold Ratings	Buy Ratings	Strong Buy Ratings	Rating Score
Torm	0	1	2	1	3.00
Delek US	0	7	5	1	2.54

Torm presently has a consensus price target of $38.00, indicating a potential upside of 10.40%. Delek US has a consensus price target of $65.45, indicating a potential downside of 9.48%. Given Torm’s stronger consensus rating and higher possible upside, equities research analysts plainly believe Torm is more favorable than Delek US.

Dividends

Torm pays an annual dividend of $7.01 per share and has a dividend yield of 20.4%. Delek US pays an annual dividend of $1.02 per share and has a dividend yield of 1.4%. Torm pays out 115.5% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Delek US pays out 28.7% of its earnings in the form of a dividend. Delek US has increased its dividend for 2 consecutive years.

Volatility and Risk

Torm has a beta of 0.12, meaning that its share price is 88% less volatile than the S&P 500. Comparatively, Delek US has a beta of 0.59, meaning that its share price is 41% less volatile than the S&P 500.

Institutional & Insider Ownership

73.9% of Torm shares are held by institutional investors. Comparatively, 97.0% of Delek US shares are held by institutional investors. 0.4% of Torm shares are held by insiders. Comparatively, 3.6% of Delek US shares are held by insiders. Strong institutional ownership is an indication that hedge funds, large money managers and endowments believe a company will outperform the market over the long term.

Profitability

This table compares Torm and Delek US’s net margins, return on equity and return on assets.

	Net Margins	Return on Equity	Return on Assets
Torm	35.51%	27.24%	17.96%
Delek US	1.86%	109.03%	6.44%

Earnings and Valuation

This table compares Torm and Delek US”s top-line revenue, earnings per share (EPS) and valuation.

	Gross Revenue	Price/Sales Ratio	Net Income	Earnings Per Share	Price/Earnings Ratio
Torm	$1.34 billion	2.62	$285.30 million	$6.07	5.67
Delek US	$10.72 billion	0.41	-$22.80 million	$3.56	20.31

Torm has higher earnings, but lower revenue than Delek US. Torm is trading at a lower price-to-earnings ratio than Delek US, indicating that it is currently the more affordable of the two stocks.

Summary

Delek US beats Torm on 9 of the 17 factors compared between the two stocks.

About Torm

TORM plc, a shipping company, owns and operates a fleet of product tankers in the United Kingdom. It operates in two operating segments, Tanker and Marine Exhaust. The Tanker segment transports refined oil products, such as gasoline, jet fuel, kerosene, naphtha, and gas oil, as well as dirty petroleum products, including fuel oil. The Marine Exhaust segment engages in developing and producing advanced and green marine equipment. TORM plc was founded in 1889 and is based in London, the United Kingdom.

About Delek US

Delek US Holdings, Inc. engages in the integrated downstream energy business in the United States. The company operates through Refining, Logistics, and Retail segments. The Refining segment processes crude oil and other feedstock for the manufacture of various grades of gasoline, diesel fuel, aviation fuel, asphalt, and other petroleum-based products that are distributed through owned and third-party product terminal. It owns and operates refineries located in Tyler, Texas; El Dorado, Arkansas; Big Spring, Texas; and Krotz Springs, Louisiana, as well as biodiesel facilities in Crossett, Arkansas, Cleburne, Texas, and New Albany, Mississippi. The Logistics segment gathers, transports, and stores crude oil, intermediate, and refined products; and markets, distributes, transports, and stores refined products, as well as disposes and recycles water for third parties. It owns or leases crude oil transportation pipelines, refined product pipelines, crude oil gathering systems, and associated crude oil storage tanks; and owns and operates light product distribution terminals, as well as markets light products using third-party terminals. The Retail segment owns and leases convenience store sites located primarily in West Texas and New Mexico. Its convenience stores offer various grades of gasoline and diesel under the DK or Alon brand; and food products and service, tobacco products, non-alcoholic and alcoholic beverages, and general merchandise, as well as money orders to the public primarily under the 7-Eleven and DK or Alon brand names. It serves oil companies, independent refiners and marketers, jobbers, distributors, utility and transportation companies, government, and independent retail fuel operators. Delek US Holdings, Inc. was founded in 2001 and is headquartered in Brentwood, Tennessee.