Valero Energy Corporation
Orin's own judgment of how firmly the evidence points one way — not the chance the price goes up.
Valero's fundamental recovery is genuine — Q2 2026 EPS of $12.62 (vs $2.28 a year earlier) on revenue of $36.6B (+22.6% YoY) delivered the strongest quarter since the 2022 refining boom, extending a streak of eight consecutive earnings beats including a +24% surprise in Q2 2026.
However, the stock at $443.80 (as of 8 Oct) has run 67% above its 200-day MA ($265.57) with an RSI of 77.1, trading above Bank of America's recently raised $414 price target (neutral rating), while a Seeking Alpha analysis flags the profitability as temporary and driven by geopolitical commodity-price shocks. Persistent insider selling — 24-month net value of -$9.39M including SVP Fisher's 22,500 shares sold at $237–268 in May–June 2026 — and a near-zero smart money score (0.00 as of 30 Jun) reinforce that the easy money has been made. Hold existing exposure; the earnings momentum is real but the setup is extended and crack-spread normalization remains the key risk.
What could go wrong
- Crack spread normalization. Seeking Alpha (8 Oct) argues VLO's recent profits are temporary, driven by geopolitical commodity price shocks, with projected normalization in crack spreads likely reducing margins and returns.
- Extreme technical overextension. RSI at 77.1 and the stock trading 67% above its 200-day MA ($265.57) as of 8 Oct leave significant mean-reversion risk; the prior verdict on 25 Sep 2025 flagged $382.86 as extended, and the stock has since risen another 16%.
- Insider distribution. Over 24 months, insiders net sold 41,144 shares worth $9.39M; SVP Fisher sold 22,500 shares at $237–268 in May–June 2026, well below the current $443.80 price.
- Valuation premium vs peers. PE of 18.4 sits 15% above the peer median of 16.0, while EV/EBITDA at 9.78 is roughly in line with the peer median of 10.09, limiting multiple expansion upside.
What would change my mind
Where this comes from: Q2 2026 results · earnings vs estimates · technicals, 8 Oct · news, 5 Oct. Orin's read on VLO; not advice.
How has the share price moved?
Up 122% over twelve months, from $174.35 on 27 Oct 2025 to $387.34 at the Tue 27 Oct 2026 close. Its highest close in that time was $459.78 on 14 Oct 2026; the last close is 15.8% below it.
- Green line: the closing price each trading day.
- Grey line: the average closing price over the last 50 trading days.
- Dashed amber line: the same over the last 200 trading days — a slower, smoother line.
- Bars along the bottom: shares traded each day — green when it closed higher than the day before, rose when lower (the most, 19.8M, on 20 Mar 2026).
- Flags: the company's filings, on the day they were made (a 10-Q is the quarterly report and a 10-K the annual report; an 8-K reports a major event).
On file
All VLO filingsLargest holders · 13F Q2 2026
Money flow| Filer | Position | Of fund |
|---|---|---|
| BlackRock | $6.5B | 0.1% |
| Vanguard Capital Management | $5.1B | 0.1% |
| State Street | $4.9B | 0.1% |
| Vanguard Portfolio Management | $3.9B | 0.2% |
| FMR | $2.2B | 0.1% |
| Morgan Stanley | $2.1B | 0.1% |
| Geode Capital Management | $1.9B | 0.1% |
| Norges Bank | $1.7B | 0.2% |
| Franklin Resources | $1.6B | 0.4% |
| Ameriprise Financial | $1.4B | 0.3% |
130 of the 815 filers we track · quarter ended Q2 2026 · positions, not flows
Insiders, last 24 months: 142 Form 4 filings; open-market trades net −$9.4M. Of the 50 on hand, 0 were open-market purchases and 6 sales — the rest are grants, option exercises and tax withholding.
Ask Orin about VLO
Orin answers questions about VLO from its filings, transcripts and numbers — with the source behind every claim. Your own desk starts with 3 free days, card required.
Start 3 free days →How is it priced, against its own past and its sector?
Priced at 8.7× its last 12 months of profit (Tue 27 Oct close); the typical Energy company on the NYSE is at 17.6×.
| Measure | Now | Its usual | Sector |
|---|---|---|---|
| P/E | 8.7× | — | 17.6× |
| P/S | 0.76×above usual | 0.30× | — |
| EV/EBITDA | 6.6×near usual | 6.6× | — |
| P/B | 3.6×above usual | 1.7× | — |
- P/E: no usual level — it ran from 4.4× to 33.1× over its last 5 fiscal years, so a middle value says little.
- "Its usual" is the middle of its own last 5 fiscal years.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
P/S: the company's total market value divided by one year of revenue. Used when there is no profit to measure.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
P/B: the share price divided by the book value per share — what the company owns minus what it owes, as its accounts record it. When book value is tiny, P/B swings wildly and says little.
What do the analysts who cover it publish?
The analysts' average 12-month price target is $451 (from $394 to $530) — 16% above the Tue 27 Oct close price. That is their published opinion, not Orin's.
$451
$394 – $530 · +16% against the last close
- 9 buy or overweight
- 7 hold
- 2 underweight or sell
Price target: the share price an analyst publishes for about 12 months ahead. It is the opinion of the firm that wrote it; the average is across the firms that cover the company.
Overweight / underweight: analysts' rating words: overweight means the firm expects the stock to do better than the others it covers, underweight worse. Their words, not Orin's.
How is it priced next to the companies it is compared to?
Priced at 8.7× its last 12 months of profit. Only 2 of the 2 companies it is compared to made a profit (MPC 15.0×, PSX 15.2×), so there is no typical P/E.
| Company | Market value | P/E | EV/EBITDA | Gross margin | Net margin | ROE |
|---|---|---|---|---|---|---|
| VLOValero Energy Corporation | $112B | 8.7× | 6.6× | 15.5% | 8.8% | 50% |
| MPCMarathon Petroleum Corporation | $122B | 15.0× | 8.5× | 11.6% | 5.6% | 49% |
| PSXPhillips 66 | $108B | 15.2× | 9.7× | 9.8% | 4.6% | 24% |
- The list of companies is the data vendor's choice, so it can include a company a person would not have picked.
Market value: the share price times the number of shares — what the whole company is priced at.
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
EV/EBITDA: the price of the whole company (its shares plus its debt, minus its cash) divided by one year of operating profit before interest, tax and write-downs.
Gross margin: the share of each $1 of sales left after the direct cost of making what was sold.
Net margin: the share of each $1 of sales kept as profit after every cost. Below zero, the company lost money.
ROE: return on equity: one year of profit as a share of the shareholders' money in the business (its book value).
Is it priced high or low compared with its own past?
Priced at 8.7× its last 12 months of profit (Tue 27 Oct close). It has no full fiscal year on file since its history starts, so there is nothing of its own to compare with.
- Now8.7×
P/E: the share price divided by one year of profit per share — roughly how many years of today's profit the price pays for. A company that loses money has no P/E.
Fiscal year (FY): the company's own 12-month accounting year, which need not match the calendar year.
How has its sector been priced?
Energy companies on the NYSE were priced at a typical 17.6× their yearly profit (Tue 27 Oct close).
- Now17.6×
- Each year is the middle of that calendar year's daily sector P/E; "Now" is the Tue 27 Oct close figure, the same one in the table above.
Sector P/E: the middle P/E of the companies in the same sector on the same stock exchange, as the data vendor works it out each day.
What does a cash-flow model say a share is worth?
A standard cash-flow model puts it at $315 a share — 20% below the $391.75 price it was computed against (27 Oct).
| Model | Value a share | Against the price then |
|---|---|---|
| Standard | $315 | 20% below $391.75 |
| Levered | $327 | 17% below $391.75 |
Discounted cash flow: a model's estimate of what the company is worth today, from the cash it is forecast to make in future years. Small changes in the forecast move it a lot, and it says little about a company that loses money.
Standard / levered: two versions of the cash-flow model: the standard one counts the cash before the company pays its lenders, the levered one after.