VALERO ENERGY CORP (VLO) Stock Fundamental Analysis
NYSE:VLO - New York Stock Exchange, Inc. - US91913Y1001 - Common Stock - Currency: USD
VLO gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 210 industry peers in the Oil, Gas & Consumable Fuels industry. VLO has a great financial health rating, but its profitability evaluates not so good. VLO has a valuation in line with the averages, but on the other hand it scores bad on growth.
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.
VLO had positive earnings in 4 of the past 5 years.
VLO had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
VLO has a Return On Assets (1.56%) which is comparable to the rest of the industry.
VLO has a Return On Equity (3.93%) which is comparable to the rest of the industry.
VLO has a Return On Invested Capital of 4.17%. This is in the lower half of the industry: VLO underperforms 62.86% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VLO is significantly below the industry average of 23.80%.
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 65.71% of its industry peers.
In the last couple of years the Profit Margin of VLO has remained more or less at the same level.
With a Operating Margin value of 1.80%, VLO is not doing good in the industry: 71.90% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of VLO has declined.
VLO has a Gross Margin of 2.59%. This is in the lower half of the industry: VLO underperforms 77.14% of its industry peers.
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.
VLO has less shares outstanding than it did 1 year ago.
VLO has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, VLO has an improved debt to assets ratio.
2.2 Solvency
An Altman-Z score of 4.33 indicates that VLO is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.33, VLO belongs to the top of the industry, outperforming 89.52% of the companies in the same industry.
The Debt to FCF ratio of VLO is 2.25, which is a good value as it means it would take VLO, 2.25 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 2.25, VLO belongs to the best of the industry, outperforming 80.48% of the companies in the same industry.
A Debt/Equity ratio of 0.44 indicates that VLO is not too dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.44, VLO is in line with its industry, outperforming 51.43% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 4.33 |
ROIC/WACC0.46
WACC9.06%
2.3 Liquidity
A Current Ratio of 1.56 indicates that VLO should not have too much problems paying its short term obligations.
VLO's Current ratio of 1.56 is fine compared to the rest of the industry. VLO outperforms 69.05% 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 (1.09) which is comparable to the rest of the industry.
| 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%.
VLO shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 8.76% yearly.
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
VLO is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 20.82% yearly.
The Revenue is expected to decrease by -3.58% on average over the next years.
EPS Next Y-17.47%
EPS Next 2Y9.02%
EPS Next 3Y17.37%
EPS Next 5Y20.82%
Revenue Next Year-11.07%
Revenue Next 2Y-6.45%
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
The Price/Earnings ratio is 27.17, which means the current valuation is very expensive for VLO.
Compared to the rest of the industry, the Price/Earnings ratio of VLO is on the same level as its industry peers.
The average S&P500 Price/Earnings ratio is at 27.50. VLO is around the same levels.
Based on the Price/Forward Earnings ratio of 14.80, the valuation of VLO can be described as correct.
VLO's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 36.44, VLO is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.17 | ||
| Fwd PE | 14.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of VLO is on the same level as its industry peers.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of VLO indicates a somewhat cheap valuation: VLO is cheaper than 78.10% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.47 | ||
| EV/EBITDA | 10.24 |
4.3 Compensation for Growth
VLO's earnings are expected to grow with 17.37% in the coming years. This may justify a more expensive valuation.
PEG (NY)N/A
PEG (5Y)3.1
EPS Next 2Y9.02%
EPS Next 3Y17.37%
5. Dividend
5.1 Amount
VLO has a Yearly Dividend Yield of 3.12%.
Compared to an average industry Dividend Yield of 6.48, VLO has a dividend in line with its industry peers.
VLO's Dividend Yield is a higher than the S&P500 average which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.12% |
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 their dividend for at least 10 years, which is a reliable track record.
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.
The dividend of VLO is growing, but earnings are growing more, so the dividend growth is sustainable.
DP149.78%
EPS Next 2Y9.02%
EPS Next 3Y17.37%
146.15
+1.48 (+1.02%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners87.35%
Inst Owner Change-0.18%
Ins Owners0.36%
Ins Owner Change1.94%
Market Cap45.78B
Analysts80.8
Price Target156.85 (7.32%)
Short Float %4.46%
Short Ratio4.37
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.12% |
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)6.35%
PT rev (3m)1.37%
EPS NQ rev (1m)-1.87%
EPS NQ rev (3m)-31.81%
EPS NY rev (1m)2.05%
EPS NY rev (3m)-1.32%
Revenue NQ rev (1m)-0.09%
Revenue NQ rev (3m)-10%
Revenue NY rev (1m)-0.01%
Revenue NY rev (3m)-4.79%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 27.17 | ||
| Fwd PE | 14.8 | ||
| P/S | 0.36 | ||
| P/FCF | 9.47 | ||
| P/OCF | 7.91 | ||
| P/B | 1.95 | ||
| P/tB | 1.95 | ||
| EV/EBITDA | 10.24 |
EPS(TTM)5.38
EY3.68%
EPS(NY)9.88
Fwd EY6.76%
FCF(TTM)15.43
FCFY10.56%
OCF(TTM)18.48
OCFY12.65%
SpS409.88
BVpS75
TBVpS75
PEG (NY)N/A
PEG (5Y)3.1
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 | 4.33 |
F-Score4
WACC9.06%
ROIC/WACC0.46
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-17.47%
EPS Next 2Y9.02%
EPS Next 3Y17.37%
EPS Next 5Y20.82%
Revenue 1Y (TTM)-8.36%
Revenue growth 3Y4.45%
Revenue growth 5Y3.7%
Sales Q2Q%-4.73%
Revenue Next Year-11.07%
Revenue Next 2Y-6.45%
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%