Valero Energy’s Stock Shows Mixed Performance Amidst Market Trends
Valero Energy Corporation (VLO), based in San Antonio, Texas, specializes in the production, marketing, and sale of petroleum-based and low-carbon liquid transportation fuels alongside petrochemical products. With a market cap of $45 billion, the company manufactures a variety of refined offerings, including conventional gasolines, diesel fuels, lubricants, and more.
Valero’s Year-Long Struggles Compared to Market
Over the last year, VLO shares have not kept pace with the broader market, rising only 13.2% while the S&P 500 Index ($SPX) surged nearly 30.1%. In 2024 alone, VLO reported an 8.6% gain, contrasting sharply with the SPX’s impressive 24.1% climb year-to-date (YTD).
Performance Against Industry Peers
When compared to the VanEck Oil Refiners ETF (CRAK), Valero shows a contrasting picture. The ETF has faced a decline of approximately 10.5% over the past year, while Valero’s YTD performance surpasses that of the ETF, which has seen losses of 8.4% over the same period.
Recent Earnings Miss and Future Expectations
On October 24, Valero’s stock dipped over 1% following the release of its Q3 results. The company reported earnings per share (EPS) of $1.14, falling short of expectations set by analysts at $1.29. Revenue came in at $32.9 billion, also missing the projected $33 billion.
For the fiscal year ending in December, analysts predict a significant decline in VLO’s EPS, with an estimated drop of 64.2% to $8.92 on a diluted basis. Historically, Valero’s performance against analysts’ estimates has been mixed, as it has met or exceeded expectations in three of the last four quarters.
Analysts Remain Optimistic Despite Challenges
Among the 18 analysts who follow VLO, the consensus rating is a “Strong Buy,” supported by 14 “Strong Buy” ratings, three “Holds,” and one “Strong Sell.” This outlook has improved over the last two months, as the number of analysts recommending a “Strong Buy” has increased from 13.
Future Price Targets Indicate Potential Gains
On November 11, Barclays PLC (BCS) analyst Theresa Chen maintained an “Overweight” rating on VLO, adjusting the price target to $140. The average price target of $153.33 reflects an 8.6% increase over VLO’s current pricing. The highest target set by analysts is $176, suggesting an upside potential of 24.6%.
On the date of publication, Neha Panjwani did not have any positions in the securities mentioned in this article. All information and data provided are for informational purposes only. For more details, please refer to the Barchart Disclosure Policy.
The views and opinions expressed herein are those of the author and do not necessarily reflect those of Nasdaq, Inc.
