VALERO ENERGY CORP (VLO)

US91913Y1001 - Common Stock

171.13  +3.32 (+1.98%)

Fundamental Rating

6

Taking everything into account, VLO scores 6 out of 10 in our fundamental rating. VLO was compared to 214 industry peers in the Oil, Gas & Consumable Fuels industry. VLO has an excellent financial health rating, but there are some minor concerns on its profitability. VLO has a valuation in line with the averages, but on the other hand it scores bad on growth.



6

1. Profitability

1.1 Basic Checks

VLO had positive earnings in the past year.
VLO had a positive operating cash flow in the past year.
Of the past 5 years VLO 4 years were profitable.
Each year in the past 5 years VLO had a positive operating cash flow.

1.2 Ratios

Looking at the Return On Assets, with a value of 13.97%, VLO is in the better half of the industry, outperforming 77.00% of the companies in the same industry.
With an excellent Return On Equity value of 33.43%, VLO belongs to the best of the industry, outperforming 80.28% of the companies in the same industry.
VLO has a Return On Invested Capital of 19.91%. This is amongst the best in the industry. VLO outperforms 85.92% of its industry peers.
VLO had an Average Return On Invested Capital over the past 3 years of 17.35%. This is significantly below the industry average of 48.71%.
The 3 year average ROIC (17.35%) for VLO is below the current ROIC(19.91%), indicating increased profibility in the last year.
Industry RankSector Rank
ROA 13.97%
ROE 33.43%
ROIC 19.91%
ROA(3y)11.47%
ROA(5y)7.23%
ROE(3y)29.06%
ROE(5y)18.14%
ROIC(3y)17.35%
ROIC(5y)N/A

1.3 Margins

With a Profit Margin value of 6.08%, VLO is not doing good in the industry: 68.08% of the companies in the same industry are doing better.
VLO's Profit Margin has improved in the last couple of years.
VLO's Operating Margin of 8.19% is on the low side compared to the rest of the industry. VLO is outperformed by 74.65% of its industry peers.
In the last couple of years the Operating Margin of VLO has grown nicely.
With a Gross Margin value of 8.93%, VLO is not doing good in the industry: 77.93% of the companies in the same industry are doing better.
VLO's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 8.19%
PM (TTM) 6.08%
GM 8.93%
OM growth 3YN/A
OM growth 5Y15.14%
PM growth 3YN/A
PM growth 5Y18%
GM growth 3YN/A
GM growth 5Y12.67%

8

2. Health

2.1 Basic Checks

VLO has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
The number of shares outstanding for VLO has been reduced compared to 1 year ago.
Compared to 5 years ago, VLO has less shares outstanding
The debt/assets ratio for VLO has been reduced compared to a year ago.

2.2 Solvency

VLO has an Altman-Z score of 5.02. This indicates that VLO is financially healthy and has little risk of bankruptcy at the moment.
With an excellent Altman-Z score value of 5.02, VLO belongs to the best of the industry, outperforming 90.14% of the companies in the same industry.
VLO has a debt to FCF ratio of 1.39. This is a very positive value and a sign of high solvency as it would only need 1.39 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 1.39, VLO belongs to the top of the industry, outperforming 80.75% of the companies in the same industry.
A Debt/Equity ratio of 0.38 indicates that VLO is not too dependend on debt financing.
VLO has a Debt to Equity ratio of 0.38. This is comparable to the rest of the industry: VLO outperforms 55.87% of its industry peers.
Industry RankSector Rank
Debt/Equity 0.38
Debt/FCF 1.39
Altman-Z 5.02
ROIC/WACC2.49
WACC8%

2.3 Liquidity

VLO has a Current Ratio of 1.56. This is a normal value and indicates that VLO is financially healthy and should not expect problems in meeting its short term obligations.
VLO has a better Current ratio (1.56) than 68.54% of its industry peers.
VLO has a Quick Ratio of 1.11. This is a normal value and indicates that VLO is financially healthy and should not expect problems in meeting its short term obligations.
VLO has a Quick ratio (1.11) which is in line with its industry peers.
Industry RankSector Rank
Current Ratio 1.56
Quick Ratio 1.11

2

3. Growth

3.1 Past

The earnings per share for VLO have decreased strongly by -15.58% in the last year.
The Earnings Per Share has been growing by 27.69% on average over the past years. This is a very strong growth
VLO shows a very negative growth in Revenue. In the last year, the Revenue has decreased by -17.93%.
VLO shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.35% yearly.
EPS 1Y (TTM)-15.58%
EPS 3YN/A
EPS 5Y27.69%
EPS growth Q2Q-57.99%
Revenue 1Y (TTM)-17.93%
Revenue growth 3Y30.65%
Revenue growth 5Y4.35%
Revenue growth Q2Q-15.17%

3.2 Future

VLO is expected to show a very negative growth in Earnings Per Share. In the coming years, the EPS will decrease by -27.95% yearly.
The Revenue is expected to decrease by -7.15% on average over the next years.
EPS Next Y-37.78%
EPS Next 2Y-26.6%
EPS Next 3Y-22.98%
EPS Next 5Y-27.95%
Revenue Next Year-9.99%
Revenue Next 2Y-7%
Revenue Next 3Y-8.35%
Revenue Next 5Y-7.15%

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

6

4. Valuation

4.1 Price/Earnings Ratio

With a Price/Earnings ratio of 6.93, the valuation of VLO can be described as very cheap.
Based on the Price/Earnings ratio, VLO is valued a bit cheaper than 77.00% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 26.42. VLO is valued rather cheaply when compared to this.
VLO is valuated reasonably with a Price/Forward Earnings ratio of 11.13.
Based on the Price/Forward Earnings ratio, VLO is valued a bit cheaper than the industry average as 61.97% of the companies are valued more expensively.
VLO is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.74, which is the current average of the S&P500 Index.
Industry RankSector Rank
PE 6.93
Fwd PE 11.13

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, VLO is valued a bit cheaper than the industry average as 70.42% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, VLO is valued a bit cheaper than the industry average as 77.00% of the companies are valued more expensively.
Industry RankSector Rank
P/FCF 6.84
EV/EBITDA 4.25

4.3 Compensation for Growth

The decent profitability rating of VLO may justify a higher PE ratio.
VLO's earnings are expected to decrease with -22.98% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.25
EPS Next 2Y-26.6%
EPS Next 3Y-22.98%

5

5. Dividend

5.1 Amount

VLO has a Yearly Dividend Yield of 2.50%.
VLO's Dividend Yield is comparable with the industry average which is at 5.86.
VLO's Dividend Yield is comparable with the S&P500 average which is at 2.34.
Industry RankSector Rank
Dividend Yield 2.5%

5.2 History

The dividend of VLO has a limited annual growth rate of 5.08%.
VLO has been paying a dividend for at least 10 years, so it has a reliable track record.
VLO has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)5.08%
Div Incr Years1
Div Non Decr Years13

5.3 Sustainability

VLO pays out 16.49% of its income as dividend. This is a sustainable payout ratio.
DP16.49%
EPS Next 2Y-26.6%
EPS Next 3Y-22.98%

VALERO ENERGY CORP

NYSE:VLO (3/28/2024, 3:52:09 PM)

171.13

+3.32 (+1.98%)

Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap56.90B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 2.5%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
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EPS beat(8)
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EPS beat(16)
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Revenue beat(2)
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Revenue beat(8)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 6.93
Fwd PE 11.13
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)0.25
Profitability
Industry RankSector Rank
ROA 13.97%
ROE 33.43%
ROCE
ROIC
ROICexc
ROICexgc
OM 8.19%
PM (TTM) 6.08%
GM 8.93%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover2.3
Health
Industry RankSector Rank
Debt/Equity 0.38
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.56
Quick Ratio 1.11
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)-15.58%
EPS 3YN/A
EPS 5Y
EPS growth Q2Q
EPS Next Y-37.78%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-17.93%
Revenue growth 3Y30.65%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y