NYSE:VLO

Valero Energy Corp (VLO)

397.04
+14.09 (3.68%)
as of Sep 15, 2026, 8:00:00 pm Market Open.
62 watching
0
BUY
A buying opportunity, but it is not going to turn around overnight.
DON'T BUY
From a profitability standpoint, refiners are in a difficult spot. They are geared to produce as much gasoline as they can but gas inventories are not tight. However, diesel inventories are tight. Crude prices continue to move higher.
HOLD
(Market Call Minute.) Too much gas inventory and high fuel prices means margins are weak.
PAST TOP PICK
(A Top Pick July 27/07. Down 39%.) Refiners are caught with demand for gasoline going down and the price going up. They also have to buy crude. Reduced his weighting from 5% to 1.25%. Model price is $79, a 77% positive differential.
DON'T BUY
Stock price is probably down due to quality of assets and quality of management. When you are buying, you might as well buy the leading companies. Also prefers Canadian companies to get the dividend tax credit.
DON'T BUY
Higher crude prices made it harder to get a margin on gasoline.
SELL
Refineries are really having a tough time here. His model price is $79.26, a 66% positive differential. He still has it but it is no longer in his Top 10. There is going to come a time when these companies will make nothing but money. Consider changing to Canadian companies. (See his Top Picks.)
COMMENT
Crack spread for a refinery is when they buy oil at X dollars and refine it (the crack) and sell it. The profit is the crack spread. Demand for gasoline has not been strong and North American economy has been weakening. This is a cyclical business and that will change. If you are a long-term investor you could take advantage of the weakness and Buy. Doesn't see relief in the near term but in the medium to long term there could be value.
BUY
Refinery. Stock has been hit hard as oil has gone up. An attractive place to be. Have a lot of assets and there are no new refineries being built in the US.
WEAK BUY
A good entry point. Crude prices are very high. There is an imbalance in supply and demand hurting the sector. Coming into the driving season. The second quarter should be significantly stronger than the first.
WATCH
Valero fits into the group of refiners and marketers. Seasonally we are close to get into the driving period. So you will probably get a bounce in the short term. Use the bounce to evaluate if you want to keep it. Don't buy in now.
COMMENT
Crack spread is far more important to a refiner than the price of oil. The spread has been narrowing from exceptionally wide levels. All existing refineries are working to full capacity, and being fairly old having things occasionally go bang.
PAST TOP PICK
(A Top Pick Feb 1/07. Up 1.5% including dividends.) His model price is $93.96, a 66% positive differential. Still a Buy.
BUY
The refining industry is a difficult one, but they don’t build any more of them. Fairly cheap on a Price/Sales and Price/Earnings level. Would prefer a high dividend yield.
PARTIAL BUY
His model price is $94.91. Trying to put in a bottom here, which would be about $54.80. Look for it to stabilize around this price. Would be looking at accumulating a little bit here.
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