A financial researcher and avid investor with a keen eye for innovation and disruption, as well as growth buy-outs and value stocks. Keeping an eye on the pace of high tech and early growth companies, I write about current events and the biggest news surrounding the industry, and strive to provide readers with ample research and investment opportunities.Analyst’s Disclosure:I/we have a beneficial long position in the shares of VLO either through stock ownership, options, or other derivatives. I wrote this a ...

Core Viewpoint - The market anticipates a year-over-year decline in Valero Energy's earnings due to lower revenues, with a focus on how actual results compare to estimates impacting stock price [1][2]. Earnings Expectations - Valero Energy is expected to report quarterly earnings of $1.76 per share, reflecting a year-over-year decrease of 35.1% [3]. - Revenues are projected to be $27.84 billion, down 19.3% from the same quarter last year [3]. Estimate Revisions - The consensus EPS estimate has been revised 3.01% higher in the last 30 days, indicating a reassessment by analysts [4]. - A positive Earnings ESP of +1.22% suggests analysts have recently become more optimistic about Valero's earnings prospects [12]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that a positive reading is a strong predictor of an earnings beat, especially when combined with a Zacks Rank of 1, 2, or 3 [10]. - Valero currently holds a Zacks Rank of 3, indicating a likelihood of beating the consensus EPS estimate [12]. Historical Performance - In the last reported quarter, Valero was expected to post earnings of $0.43 per share but delivered $0.89, resulting in a surprise of +106.98% [13]. - Over the past four quarters, Valero has beaten consensus EPS estimates three times [14]. Conclusion - Valero Energy is positioned as a compelling earnings-beat candidate, but investors should consider other factors influencing stock performance beyond earnings results [17].

Group 1 - Analyst has been writing on Seeking Alpha since 2018 and has over a decade of market experience [1] - Analyst has professional experience in private equity, real estate, and economic research [1] - Analyst possesses an academic background in financial econometrics, economic forecasting, and global monetary economics [1]

Company Overview - Valero Energy (VLO) shares increased by 3.4% to close at $148.67, with a notable trading volume compared to normal sessions, and a total gain of 12.1% over the past four weeks [1][2] Refining Sector Insights - The surge in Valero's stock is attributed to its strong position in the refining sector and an anticipated improvement in refining margins in the U.S. due to a decline in domestic refining capacity from the closure of major refineries [2] - Valero operates a robust network of refineries with a throughput capacity of 3.2 million barrels per day, positioning the company to benefit from rising refining margins [2] - The company's low-cost operations in refining allow it to maintain profitability across commodity cycles, further enhancing its growth potential [2] Renewable Energy Initiatives - Valero's involvement in producing renewable diesel and sustainable aviation fuels (SAF) positions it as a leader in the low-carbon fuels market, contributing to its growth drivers [2] Earnings Expectations - Valero is expected to report quarterly earnings of $1.75 per share, reflecting a year-over-year decline of 35.4%, with revenues projected at $27.93 billion, down 19% from the previous year [3] - The consensus EPS estimate for Valero has been revised 7.1% higher over the last 30 days, indicating a positive trend that typically correlates with stock price appreciation [4] Industry Context - Valero Energy is part of the Zacks Oil and Gas - Refining and Marketing industry, which includes other companies like World Kinect (WKC) [5] - World Kinect's consensus EPS estimate has changed by -6.1% over the past month, with a Zacks Rank of 5 (Strong Sell), contrasting with Valero's more favorable outlook [6]

Core Viewpoint - Valero Energy is expected to report a significant decline in earnings and revenue in its upcoming financial results, with analysts projecting a decrease in both metrics compared to the previous year [2][3]. Financial Performance - Valero Energy's earnings per share (EPS) for the upcoming quarter is projected to be $1.77, reflecting a 34.69% decrease from the same quarter last year [2]. - The anticipated revenue for the same quarter is $27.83 billion, indicating a 19.3% decline from the previous year [2]. - For the entire year, the Zacks Consensus Estimates forecast earnings of $6.19 per share and revenue of $115.9 billion, representing changes of -27% and -10.76%, respectively, compared to the previous year [3]. Analyst Estimates - Recent revisions in analyst estimates for Valero Energy suggest a positive outlook on the company's business operations and profit generation capabilities [3]. - The Zacks Consensus EPS estimate has shifted 1.79% upward over the past month, indicating some analyst optimism [5]. Valuation Metrics - Valero Energy has a Forward P/E ratio of 22.12, which is higher than its industry's Forward P/E of 17.86, suggesting a premium valuation [6]. - The company has a PEG ratio of 2.39, compared to the industry average PEG ratio of 1.58, indicating that the stock may be overvalued relative to its expected earnings growth [7]. Industry Context - The Oil and Gas - Refining and Marketing industry, which includes Valero Energy, currently holds a Zacks Industry Rank of 148, placing it in the bottom 40% of all industries [8].

Refining Operations - Valero has 15 refineries with a high-complexity throughput capacity of 3.2 million barrels per day[7] - Valero's refining segment adjusted EBITDA per barrel averaged $7.20 from 2015 to 2024[192] - Valero's global wholesale volumes reached 1.517 million barrels per day in 2024, representing 60% of total light products production[80] Low-Carbon Fuels - Valero has a renewable diesel production capacity of up to 1.2 billion gallons per year[8] - The Diamond Green Diesel (DGD) Port Arthur plant has the capability to upgrade approximately 235 million gallons per year of renewable diesel production capacity to sustainable aviation fuel (SAF)[8, 39] - Valero's ethanol plants have a combined production capacity of 1.7 billion gallons per year[9] Financial Performance and Capital Allocation - Valero's average payout ratio to stockholders has been 70% since 2014, or 58% excluding 2020[16] - Valero has reduced shares outstanding by over 38% since 2014[16] - Valero's cumulative EBITDA from renewable diesel reached $2.957 billion, with cumulative capital expenditures of $1.986 billion[34] - Valero targets a 20% to 30% net debt-to-capital ratio[47]

Group 1: Stock Performance - Valero Energy (VLO) closed at $137.06, down 2.86% from the previous day, underperforming the S&P 500 which gained 0.96% [1] - Over the past month, Valero's shares have increased by 9.76%, outperforming the Oils-Energy sector's gain of 6.67% and the S&P 500's gain of 0.5% [1] Group 2: Upcoming Earnings Release - Valero Energy's earnings report is expected on July 24, 2025, with an anticipated EPS of $1.77, representing a 34.69% decline compared to the same quarter last year [2] - The Zacks Consensus Estimate projects net sales of $27.83 billion, down 19.3% from the year-ago period [2] Group 3: Fiscal Year Projections - For the entire fiscal year, the Zacks Consensus Estimates project earnings of $6.19 per share and revenue of $115.9 billion, reflecting changes of -27% and -10.76% respectively from the prior year [3] - Recent changes to analyst estimates indicate a favorable outlook on Valero's business health and profitability [3] Group 4: Zacks Rank and Valuation - Valero Energy currently holds a Zacks Rank of 3 (Hold), with the Zacks Consensus EPS estimate moving 1.01% higher over the past month [5] - The company has a Forward P/E ratio of 22.79, which is a premium compared to the industry average Forward P/E of 17.67 [6] Group 5: PEG Ratio and Industry Ranking - Valero's PEG ratio is currently 2.46, compared to the industry average PEG ratio of 1.62 [7] - The Oil and Gas - Refining and Marketing industry, which includes Valero, ranks in the bottom 42% of all industries according to the Zacks Industry Rank [8]

Group 1 - Valero Energy Corp's stock has gained nearly 40% since April, leading analysts to anticipate profit-taking due to overbought conditions [1] - The stock has faced resistance at the $142.50 level, which has historically led to sell-offs when reached [2][3] - Previous instances of reaching this resistance level resulted in traders placing sell orders, creating a pattern of selling pressure [4] Group 2 - The current overbought conditions at the resistance level suggest that a sell-off may occur soon, as traders anticipate a reversal [5]

The second quarter is set up for a meaningful rebound in earnings for Valero Energy (NYSE: VLO ). The company’s industry leading cost profile gives VLO a leading edge in returning cash to shareholdersI am a Licensed Professional Engineer who works in the Nuclear Power industry. I use my professional working knowledge of the power/energy industries to aid in evaluating potential equities worthy of long-term investment. I invest in income producing equities and rental real estate properties for cash flow and ...

Company Overview - Valero Energy (VLO) closed at $128.97, reflecting a -0.15% change from the previous trading day, underperforming the S&P 500 which had a daily loss of 0.01% [1] - The stock has increased by 12.43% over the past month, outperforming the Oils-Energy sector's gain of 2.31% and the S&P 500's gain of 6.43% [1] Earnings Projections - The upcoming EPS for Valero Energy is projected at $2.54, indicating a 6.27% decline compared to the same quarter last year [2] - Quarterly revenue is estimated at $27.88 billion, down 19.16% from the previous year [2] - For the full year, earnings are projected at $6.08 per share and revenue at $115.97 billion, reflecting changes of -28.3% and -10.71% respectively from the prior year [3] Analyst Sentiment - Recent shifts in analyst projections for Valero Energy are important for investors, as positive revisions indicate optimism about the company's business and profitability [4] - The Zacks Consensus EPS estimate has decreased by 0.35% in the past month, and Valero Energy currently holds a Zacks Rank of 3 (Hold) [6] Valuation Metrics - Valero Energy has a Forward P/E ratio of 21.23, which is higher than the industry average Forward P/E of 16.76 [7] - The company has a PEG ratio of 2.29, compared to the industry average PEG ratio of 1.48 [8] Industry Context - The Oil and Gas - Refining and Marketing industry, which includes Valero Energy, has a Zacks Industry Rank of 139, placing it in the bottom 44% of over 250 industries [9] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [9]