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Valero Energy Corp VLO

Morningstar Rating
$150.07 +0.25 (0.17%)
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Company Report

Valero Shares Look Overvalued Despite Strong Competitive Position

Valero remains well positioned for almost any market environment thanks to its high-quality refining assets and their location, which affords it greater feedstock flexibility. Historically, Valero has held an advantage thanks to its system of 15 refineries that is more complex than competitors', allowing it to process lower-quality feedstock into a high-value product. With the emergence of domestic light crude discounts it pivoted to processing greater amounts of high-quality discounted domestic crude by substituting domestic for imported crude, constructing additional light crude processing capacity and investing in transportation infrastructure.

Price vs Fair Value

VLO is trading at a 147% premium.
Price
$150.07
Fair Value
$168.00
Uncertainty
Very High
1-Star Price
$997.00
5-Star Price
$78.00
Economic Moat
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Capital Allocation
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Bulls Say, Bears Say

Bulls

Valero enjoys a cost advantage thanks to its proximity to cost advantaged light crude oil, ability to process discount heavy sour crude, and low operating cost from lower domestic natural gas prices.

Bears

Growing EV adoption will result in gasoline demand destruction and leave Valero's refineries uneconomical, given the high portion of gasoline production.

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News

Trading Information

Previous Close Price
$149.82
Day Range
$148.00150.91
52-Week Range
$108.28184.79
Bid/Ask
$148.67 / $151.75
Market Cap
$49.07 Bil
Volume/Avg
2.6 Mil / 2.9 Mil

Key Statistics

Price/Earnings (Normalized)
7.41
Price/Sales
0.37
Dividend Yield (Trailing)
2.79%
Dividend Yield (Forward)
2.85%
Total Yield
12.31%

Company Profile

Valero Energy is one of the largest independent refiners in the United States. It operates 15 refineries, with a total throughput capacity of 3.2 million barrels a day in the US, Canada, and the United Kingdom. Valero also owns 12 ethanol plants with capacity of 1.6 billion gallons a year and holds a 50% stake in Diamond Green Diesel, which has the capacity to produce 1.2 billion gallons per year of renewable diesel.
Sector
Energy
Industry
Oil & Gas Refining & Marketing
Stock Style Box
Mid Value
Total Number of Employees
9,908

Competitors

Valuation

Metric
VLO
DINO
PSX
Price/Earnings (Normalized)
7.414.4910.14
Price/Book Value
1.881.011.95
Price/Sales
0.370.320.41
Price/Cash Flow
5.134.548.00
Price/Earnings
VLO
DINO
PSX

Financial Strength

Metric
VLO
DINO
PSX
Quick Ratio
1.061.060.74
Current Ratio
1.592.171.17
Interest Coverage
16.6911.638.79
Quick Ratio
VLO
DINO
PSX

Profitability

Metric
VLO
DINO
PSX
Return on Assets (Normalized)
11.36%8.67%7.88%
Return on Equity (Normalized)
27.22%15.99%19.90%
Return on Invested Capital (Normalized)
18.44%12.01%12.71%
Return on Assets
VLO
DINO
PSX
See how this stock stacks up to its competitors with Morningstar Investor

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