VALERO ENERGY CORP (VLO) Stock Fundamental Analysis
NYSE:VLO - New York Stock Exchange, Inc. - US91913Y1001 - Common Stock - Currency: USD
Taking everything into account, VLO scores 4 out of 10 in our fundamental rating. VLO was compared to 213 industry peers in the Oil, Gas & Consumable Fuels industry. No worries on liquidiy or solvency for VLO as it has an excellent financial health rating, but there are worries on the profitability. VLO does not seem to be growing, but still is valued expensively.
1. Profitability
1.1 Basic Checks
In the past year VLO was profitable.
In the past year VLO had a positive cash flow from operations.
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
With a Return On Assets value of 1.56%, VLO perfoms like the industry average, outperforming 41.31% of the companies in the same industry.
Looking at the Return On Equity, with a value of 3.93%, VLO is in line with its industry, outperforming 42.72% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 4.17%, VLO is doing worse than 62.91% of the companies in the same industry.
VLO had an Average Return On Invested Capital over the past 3 years of 18.62%. This is below the industry average of 23.55%.
The last Return On Invested Capital (4.17%) for VLO is well below the 3 year average (18.62%), which needs to be investigated, but indicates that VLO had better years and this may not be a problem.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.56% | ||
| ROE | 3.93% | ||
| ROIC | 4.17% |
ROA(3y)12.46%
ROA(5y)7.25%
ROE(3y)31.15%
ROE(5y)18.17%
ROIC(3y)18.62%
ROIC(5y)N/A
1.3 Margins
VLO has a Profit Margin of 0.72%. This is in the lower half of the industry: VLO underperforms 65.73% of its industry peers.
In the last couple of years the Profit Margin of VLO has remained more or less at the same level.
Looking at the Operating Margin, with a value of 1.80%, VLO is doing worse than 71.83% of the companies in the same industry.
In the last couple of years the Operating Margin of VLO has declined.
Looking at the Gross Margin, with a value of 2.59%, VLO is doing worse than 77.00% of the companies in the same industry.
In the last couple of years the Gross Margin of VLO has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 1.8% | ||
| PM (TTM) | 0.72% | ||
| GM | 2.59% |
OM growth 3Y15.66%
OM growth 5Y-3.52%
PM growth 3Y37.91%
PM growth 5Y-0.94%
GM growth 3Y10.46%
GM growth 5Y-3.09%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), VLO is creating value.
Compared to 1 year ago, VLO has less shares outstanding
Compared to 5 years ago, VLO has less shares outstanding
Compared to 1 year ago, VLO has an improved debt to assets ratio.
2.2 Solvency
VLO has an Altman-Z score of 4.27. This indicates that VLO is financially healthy and has little risk of bankruptcy at the moment.
VLO has a better Altman-Z score (4.27) than 88.26% of its industry peers.
VLO has a debt to FCF ratio of 2.25. This is a good value and a sign of high solvency as VLO would need 2.25 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 2.25, VLO belongs to the top of the industry, outperforming 80.28% of the companies in the same industry.
VLO has a Debt/Equity ratio of 0.44. This is a healthy value indicating a solid balance between debt and equity.
VLO has a Debt to Equity ratio of 0.44. This is comparable to the rest of the industry: VLO outperforms 50.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 4.27 |
ROIC/WACC0.52
WACC8.01%
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.
The Current ratio of VLO (1.56) is better than 67.61% of its industry peers.
VLO has a Quick Ratio of 1.09. 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 of 1.09. This is comparable to the rest of the industry: VLO outperforms 58.69% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.09 |
3. Growth
3.1 Past
VLO shows a strong negative growth in Earnings Per Share. In the last year the EPS decreased by -73.45%.
Measured over the past years, VLO shows a quite strong growth in Earnings Per Share. The EPS has been growing by 8.76% on average per year.
The Revenue has decreased by -8.36% in the past year.
The Revenue has been growing slightly by 3.70% on average over the past years.
EPS 1Y (TTM)-73.45%
EPS 3Y50.45%
EPS 5Y8.76%
EPS Q2Q%-76.7%
Revenue 1Y (TTM)-8.36%
Revenue growth 3Y4.45%
Revenue growth 5Y3.7%
Sales Q2Q%-4.73%
3.2 Future
The Earnings Per Share is expected to grow by 20.82% on average over the next years. This is a very strong growth
The Revenue is expected to decrease by -3.58% on average over the next years.
EPS Next Y-17.65%
EPS Next 2Y11.19%
EPS Next 3Y17.52%
EPS Next 5Y20.82%
Revenue Next Year-11.06%
Revenue Next 2Y-6.46%
Revenue Next 3Y-1.82%
Revenue Next 5Y-3.58%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
With a Price/Earnings ratio of 24.93, VLO is valued on the expensive side.
Compared to the rest of the industry, the Price/Earnings ratio of VLO is on the same level as its industry peers.
VLO is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 26.32, which is the current average of the S&P500 Index.
The Price/Forward Earnings ratio is 13.05, which indicates a correct valuation of VLO.
The rest of the industry has a similar Price/Forward Earnings ratio as VLO.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.13, VLO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.93 | ||
| Fwd PE | 13.05 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as VLO.
79.34% of the companies in the same industry are more expensive than VLO, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.69 | ||
| EV/EBITDA | 9.5 |
4.3 Compensation for Growth
A more expensive valuation may be justified as VLO's earnings are expected to grow with 17.52% in the coming years.
PEG (NY)N/A
PEG (5Y)2.84
EPS Next 2Y11.19%
EPS Next 3Y17.52%
5. Dividend
5.1 Amount
VLO has a Yearly Dividend Yield of 3.39%.
VLO's Dividend Yield is comparable with the industry average which is at 6.56.
VLO's Dividend Yield is a higher than the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
5.2 History
The dividend of VLO has a limited annual growth rate of 3.43%.
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)3.43%
Div Incr Years2
Div Non Decr Years14
5.3 Sustainability
149.78% of the earnings are spent on dividend by VLO. This is not a sustainable payout ratio.
VLO's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP149.78%
EPS Next 2Y11.19%
EPS Next 3Y17.52%
134.11
+0.61 (+0.46%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners87.35%
Inst Owner Change4.39%
Ins Owners0.36%
Ins Owner Change3.5%
Market Cap42.00B
Analysts81.67
Price Target147.48 (9.97%)
Short Float %4.16%
Short Ratio3.67
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.39% |
Yearly Dividend4.27
Dividend Growth(5Y)3.43%
DP149.78%
Div Incr Years2
Div Non Decr Years14
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)471.87%
Min EPS beat(2)109.4%
Max EPS beat(2)834.33%
EPS beat(4)4
Avg EPS beat(4)240.5%
Min EPS beat(4)3.36%
Max EPS beat(4)834.33%
EPS beat(8)7
Avg EPS beat(8)125.26%
EPS beat(12)11
Avg EPS beat(12)87.47%
EPS beat(16)15
Avg EPS beat(16)86.68%
Revenue beat(2)2
Avg Revenue beat(2)2.65%
Min Revenue beat(2)0.84%
Max Revenue beat(2)4.47%
Revenue beat(4)4
Avg Revenue beat(4)2.82%
Min Revenue beat(4)0.84%
Max Revenue beat(4)4.56%
Revenue beat(8)4
Avg Revenue beat(8)0.35%
Revenue beat(12)7
Avg Revenue beat(12)0.96%
Revenue beat(16)11
Avg Revenue beat(16)7.99%
PT rev (1m)1.78%
PT rev (3m)-4.59%
EPS NQ rev (1m)-5.57%
EPS NQ rev (3m)-28.59%
EPS NY rev (1m)0%
EPS NY rev (3m)-9.43%
Revenue NQ rev (1m)-2.77%
Revenue NQ rev (3m)-11.78%
Revenue NY rev (1m)-0.86%
Revenue NY rev (3m)-5.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 24.93 | ||
| Fwd PE | 13.05 | ||
| P/S | 0.33 | ||
| P/FCF | 8.69 | ||
| P/OCF | 7.26 | ||
| P/B | 1.79 | ||
| P/tB | 1.79 | ||
| EV/EBITDA | 9.5 |
EPS(TTM)5.38
EY4.01%
EPS(NY)10.27
Fwd EY7.66%
FCF(TTM)15.43
FCFY11.51%
OCF(TTM)18.48
OCFY13.78%
SpS409.88
BVpS75
TBVpS75
PEG (NY)N/A
PEG (5Y)2.84
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.56% | ||
| ROE | 3.93% | ||
| ROCE | 5.24% | ||
| ROIC | 4.17% | ||
| ROICexc | 4.66% | ||
| ROICexgc | 4.66% | ||
| OM | 1.8% | ||
| PM (TTM) | 0.72% | ||
| GM | 2.59% | ||
| FCFM | 3.76% |
ROA(3y)12.46%
ROA(5y)7.25%
ROE(3y)31.15%
ROE(5y)18.17%
ROIC(3y)18.62%
ROIC(5y)N/A
ROICexc(3y)20.98%
ROICexc(5y)N/A
ROICexgc(3y)21.17%
ROICexgc(5y)N/A
ROCE(3y)23.41%
ROCE(5y)N/A
ROICexcg growth 3Y17.52%
ROICexcg growth 5Y-0.99%
ROICexc growth 3Y17.62%
ROICexc growth 5Y-0.91%
OM growth 3Y15.66%
OM growth 5Y-3.52%
PM growth 3Y37.91%
PM growth 5Y-0.94%
GM growth 3Y10.46%
GM growth 5Y-3.09%
F-Score4
Asset Turnover2.17
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 2.25 | ||
| Debt/EBITDA | 2.03 | ||
| Cap/Depr | 34.51% | ||
| Cap/Sales | 0.74% | ||
| Interest Coverage | 4.27 | ||
| Cash Conversion | 114.02% | ||
| Profit Quality | 523.05% | ||
| Current Ratio | 1.56 | ||
| Quick Ratio | 1.09 | ||
| Altman-Z | 4.27 |
F-Score4
WACC8.01%
ROIC/WACC0.52
Cap/Depr(3y)44.8%
Cap/Depr(5y)55.94%
Cap/Sales(3y)0.76%
Cap/Sales(5y)1.3%
Profit Quality(3y)132.8%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-73.45%
EPS 3Y50.45%
EPS 5Y8.76%
EPS Q2Q%-76.7%
EPS Next Y-17.65%
EPS Next 2Y11.19%
EPS Next 3Y17.52%
EPS Next 5Y20.82%
Revenue 1Y (TTM)-8.36%
Revenue growth 3Y4.45%
Revenue growth 5Y3.7%
Sales Q2Q%-4.73%
Revenue Next Year-11.06%
Revenue Next 2Y-6.46%
Revenue Next 3Y-1.82%
Revenue Next 5Y-3.58%
EBIT growth 1Y-75.7%
EBIT growth 3Y20.8%
EBIT growth 5Y0.04%
EBIT Next Year56.95%
EBIT Next 3Y29.87%
EBIT Next 5Y16.58%
FCF growth 1Y-64.45%
FCF growth 3Y11.26%
FCF growth 5Y10.31%
OCF growth 1Y-61.8%
OCF growth 3Y4.48%
OCF growth 5Y3.86%