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Valero Energy Corp VLO

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Morningstar’s Analysis

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Winter Storm Expenses Hit Valero’s Q1 Earnings but Transitory Issue Does Not Derail Recovery

Allen Good, CFA Sector Strategist

Analyst Note

| Allen Good, CFA |

Valero reported a first-quarter loss, but winter storm costs, exacerbated the headline earnings figure. Regardless, our thesis is unchanged and expect Valero to continue to benefit from an improved operating environment as increased demand from an economic recovery this year allows for higher utilization levels and supports a margin recovery. Given its high-quality assets, leadership position in renewable diesel and clear shareholder-return program, Valero remains one of our Best Ideas in the segment.

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Company Profile

Business Description

Valero Energy is one of the largest independent refiners in the United States. It operates 14 refineries with a total throughput capacity of 3.2 million barrels a day in the United States, Canada, and the United Kingdom. Valero also owns 14 ethanol plants with capacity of 1.7 billion gallons of ethanol a year and holds a 50% stake in Diamond Green Diesel, which has capacity to produce 275 million gallons per year of renewable diesel.

Contact
One Valero Way
San Antonio, TX, 78249
T +1 210 345-2000
Sector Energy
Industry Oil & Gas Refining & Marketing
Most Recent Earnings Mar 31, 2021
Fiscal Year End Dec 31, 2020
Stock Type Hard Assets
Employees 9,964

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