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Valero Energy (VLO) Stock Sinks As Market Gains: Here's Why

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The latest trading session saw Valero Energy (VLO - Free Report) ending at $142.34, denoting a -0.26% adjustment from its last day's close. The stock trailed the S&P 500, which registered a daily gain of 0.61%. Meanwhile, the Dow gained 0.97%, and the Nasdaq, a tech-heavy index, added 0.33%.

Coming into today, shares of the oil refiner had gained 6.4% in the past month. In that same time, the Oils-Energy sector lost 2.26%, while the S&P 500 gained 5.36%.

The investment community will be closely monitoring the performance of Valero Energy in its forthcoming earnings report. The company is scheduled to release its earnings on October 24, 2024. The company is predicted to post an EPS of $1.40, indicating an 81.31% decline compared to the equivalent quarter last year. Simultaneously, our latest consensus estimate expects the revenue to be $33.11 billion, showing a 13.78% drop compared to the year-ago quarter.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $9.61 per share and a revenue of $130.37 billion, representing changes of -61.41% and -9.94%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Valero Energy. These latest adjustments often mirror the shifting dynamics of short-term business patterns. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 21.86% lower. Valero Energy is currently a Zacks Rank #5 (Strong Sell).

In terms of valuation, Valero Energy is presently being traded at a Forward P/E ratio of 14.85. This expresses a discount compared to the average Forward P/E of 15.33 of its industry.

Also, we should mention that VLO has a PEG ratio of 3.71. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The average PEG ratio for the Oil and Gas - Refining and Marketing industry stood at 2.55 at the close of the market yesterday.

The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. With its current Zacks Industry Rank of 238, this industry ranks in the bottom 6% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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