Why Valero Energy (VLO) Outpaced the Stock Market Today
Valero Energy (VLO) closed the most recent trading day at $126.38, moving +0.81% from the previous trading session. The stock outperformed the S&P 500, which registered a daily gain of 0.59%. Elsewhere, the Dow gained 0.82%, while the tech-heavy Nasdaq added 0.55%.
The oil refiner's stock has dropped by 2.79% in the past month, falling short of the Oils-Energy sector's gain of 1.14% and the S&P 500's gain of 9.16%.
The investment community will be closely monitoring the performance of Valero Energy in its forthcoming earnings report. The company is forecasted to report an EPS of $3.54, showcasing a 58.11% downward movement from the corresponding quarter of the prior year. In the meantime, our current consensus estimate forecasts the revenue to be $38.36 billion, indicating an 8.12% decline compared to the corresponding quarter of the prior year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $24.84 per share and revenue of $147.71 billion. These totals would mark changes of -14.81% and -16.26%, respectively, from last year.
Investors should also take note of any recent adjustments to analyst estimates for Valero Energy. These revisions help to show the ever-changing nature of near-term business trends. Consequently, upward revisions in estimates express analysts' positivity towards the company's business operations and its ability to generate profits.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.
The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. The Zacks Consensus EPS estimate has moved 0.82% lower within the past month. Currently, Valero Energy is carrying a Zacks Rank of #3 (Hold).
In the context of valuation, Valero Energy is at present trading with a Forward P/E ratio of 5.05. For comparison, its industry has an average Forward P/E of 6.89, which means Valero Energy is trading at a discount to the group.
One should further note that VLO currently holds a PEG ratio of 0.84. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The average PEG ratio for the Oil and Gas - Refining and Marketing industry stood at 0.96 at the close of the market yesterday.
The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. At present, this industry carries a Zacks Industry Rank of 149, placing it within the bottom 41% of over 250 industries.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
You can find more information on all of these metrics, and much more, on Zacks.com.
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Valero Energy Corporation (VLO) : Free Stock Analysis Report
