Valero Energy Prepares for Q1 Earnings Report Amid Mixed Stock Performance
Valero Energy Corporation (VLO), with a market cap of $36.5 billion, produces and sells petroleum-based and low-carbon liquid transportation fuels and petrochemical products both domestically and internationally. Established in 1980 and headquartered in San Antonio, Texas, Valero is scheduled to release its Q1 results before the market opens on Thursday, April 24.
Analysts Predict Decrease in Earnings
Ahead of this announcement, analysts forecast that Valero will report earnings of $1.57 per share, reflecting a significant 58.9% decline from last year’s Q1 profit of $3.82 per share. The company has exceeded analysts’ expectations three times over the past four quarters but fell short on one occasion. In the previous quarter, Valero posted earnings per share (EPS) of $0.64, well above the consensus estimate of $0.13.
Long-Term Forecasts Show Improvement
Looking forward to the full fiscal year 2025, analysts project VLO will deliver an EPS of $7.35, down 13.3% from $8.48 in fiscal 2024. However, projections for fiscal 2026 suggest a strong rebound, with earnings expected to increase by 50.8% year-over-year to reach $11.08 per share.
Stock Performance Over the Year
Over the past year, Valero’s stock has seen a nearly 38% decline. This performance starkly contrasts with the S&P 500 Index’s modest gains of 2.1% and the Energy Select Sector SPDR Fund’s (XLE) decline of 21.3% during the same period.
Recent Market Response to Earnings Release
After a mixed Q4 earnings report on January 30, VLO shares dropped by 2.9%. In that quarter, the company experienced a 13.2% year-over-year decrease in revenues, totaling $30.8 billion. Despite this, a 44.1% increase in the renewable diesel margin helped Valero surpass EPS expectations. Most recently, on April 9, Valero shares fell more than 5%, driven by a decline in the price of WTI crude, which dropped over 3%.
Analyst Sentiment Remains Positive
Despite the recent challenges, analyst outlook for Valero remains largely optimistic. The consensus rating on VLO stock is “Strong Buy,” reflecting confidence among analysts. Out of 18 analysts covering VLO, 15 recommend a “Strong Buy,” while two suggest “Hold,” and one rates it a “Strong Sell.” VLO’s average price target of $149.94 offers a potential upside of 37.5% from its current trading price.
On the date of publication, Aditya Sarawgi did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article are intended for informational purposes only. For more details, please see the Barchart Disclosure Policy here.
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