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 211 industry peers in the Oil, Gas & Consumable Fuels industry. VLO has a great financial health rating, but its profitability evaluates not so good. 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.
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
VLO's Return On Assets of 1.56% is in line compared to the rest of the industry. VLO outperforms 41.71% of its industry peers.
VLO has a Return On Equity of 3.93%. This is comparable to the rest of the industry: VLO outperforms 43.60% of its industry peers.
VLO's Return On Invested Capital of 4.17% is on the low side compared to the rest of the industry. VLO is outperformed by 62.56% of its industry peers.
The Average Return On Invested Capital over the past 3 years for VLO is significantly below the industry average of 23.79%.
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
Looking at the Profit Margin, with a value of 0.72%, VLO is doing worse than 65.40% of the companies in the same industry.
In the last couple of years the Profit Margin of VLO has remained more or less at the same level.
The Operating Margin of VLO (1.80%) is worse than 71.56% of its industry peers.
VLO's Operating Margin has declined in the last couple of years.
The Gross Margin of VLO (2.59%) is worse than 76.78% of its industry peers.
VLO's Gross Margin has declined in the last couple of years.
| 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
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so 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 4.37 indicates that VLO is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.37, VLO belongs to the top of the industry, outperforming 89.57% 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.
VLO's Debt to FCF ratio of 2.25 is amongst the best of the industry. VLO outperforms 80.57% of its industry peers.
A Debt/Equity ratio of 0.44 indicates that VLO is not too dependend on debt financing.
VLO has a Debt to Equity ratio (0.44) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.44 | ||
| Debt/FCF | 2.25 | ||
| Altman-Z | 4.37 |
ROIC/WACC0.46
WACC9.07%
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 68.72% 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.
With a Quick ratio value of 1.09, VLO perfoms like the industry average, outperforming 59.72% of the companies in the same 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%.
The Earnings Per Share has been growing by 8.76% on average over the past years. This is quite good.
VLO shows a decrease in Revenue. In the last year, the revenue decreased by -8.36%.
Measured over the past years, VLO shows a small growth in Revenue. The Revenue has been growing by 3.70% on average per year.
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.
VLO is expected to show a decrease in Revenue. In the coming years, the Revenue will decrease by -3.58% yearly.
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
VLO is valuated quite expensively with a Price/Earnings ratio of 28.45.
The rest of the industry has a similar Price/Earnings ratio as VLO.
The average S&P500 Price/Earnings ratio is at 27.30. VLO is around the same levels.
The Price/Forward Earnings ratio is 15.50, which indicates a correct valuation of VLO.
VLO's Price/Forward Earnings ratio is in line with the industry average.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, VLO is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 28.45 | ||
| Fwd PE | 15.5 |
4.2 Price Multiples
VLO's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, VLO is valued a bit cheaper than 76.30% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.92 | ||
| EV/EBITDA | 10.67 |
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)3.25
EPS Next 2Y9.02%
EPS Next 3Y17.37%
5. Dividend
5.1 Amount
VLO has a Yearly Dividend Yield of 2.92%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 6.48, VLO has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.35, VLO pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.92% |
5.2 History
The dividend of VLO has a limited annual growth rate of 3.43%.
VLO has paid a dividend for at least 10 years, which is 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%
153.05
-1.76 (-1.14%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners87.35%
Inst Owner Change0.01%
Ins Owners0.36%
Ins Owner Change3.54%
Market Cap47.94B
Analysts80.8
Price Target146.79 (-4.09%)
Short Float %4.18%
Short Ratio4.23
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.92% |
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)-0.47%
PT rev (3m)-5.14%
EPS NQ rev (1m)-1.87%
EPS NQ rev (3m)-31.81%
EPS NY rev (1m)0.22%
EPS NY rev (3m)-10.61%
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 | 28.45 | ||
| Fwd PE | 15.5 | ||
| P/S | 0.37 | ||
| P/FCF | 9.92 | ||
| P/OCF | 8.28 | ||
| P/B | 2.04 | ||
| P/tB | 2.04 | ||
| EV/EBITDA | 10.67 |
EPS(TTM)5.38
EY3.52%
EPS(NY)9.88
Fwd EY6.45%
FCF(TTM)15.43
FCFY10.08%
OCF(TTM)18.48
OCFY12.08%
SpS409.88
BVpS75
TBVpS75
PEG (NY)N/A
PEG (5Y)3.25
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 | 4.37 |
F-Score4
WACC9.07%
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%