📊 VLO Key Takeaways
Is Valero Energy Corp./Tx (VLO) a Good Investment?
Valero demonstrates solid operational fundamentals with strong free cash flow generation ($4.4B) and healthy liquidity (1.65x current ratio), but faces headwinds from declining revenues (-5.5% YoY), negative gross margins, and compressed profitability in a cyclical industry. The company's ability to maintain modest net income growth despite revenue contraction shows operational resilience, though margin pressure and capital intensity require careful monitoring.
Valero shows solid core financial health with strong free cash flow generation, good liquidity, and moderate leverage, which supports resilience in a cyclical refining business. However, profitability remains thin, revenue declined year over year, and the negative gross profit alongside modest operating margins suggests earnings quality should be watched closely. The fundamentals support stability more than clear acceleration.
Why Buy Valero Energy Corp./Tx Stock? VLO Key Strengths
- Strong free cash flow generation of $4.4B with 3.5% FCF margin supporting dividend and debt service
- Conservative leverage with 0.35x debt-to-equity ratio and solid interest coverage of 5.7x
- Healthy liquidity position with $4.7B cash and 1.65x current ratio providing financial flexibility
- Positive net income growth (+0.3% YoY) despite 5.5% revenue decline shows operational efficiency
- Strong free cash flow generation of $4.35B with a 3.5% FCF margin
- Healthy balance sheet with 1.65x current ratio and modest 0.35x debt-to-equity
- Net income remained stable year over year despite lower revenue, indicating operating resilience
VLO Stock Risks: Valero Energy Corp./Tx Investment Risks
- Negative gross margin of -0.2% indicates refining margins are highly compressed and vulnerable to commodity price fluctuations
- Revenue decline of 5.5% YoY suggests weak demand or lower product pricing in petroleum refining markets
- Low net margin of 1.9% provides minimal cushion for operational disruptions or further industry downturns
- Capital-intensive business model requiring $1.5B annual capex limits financial flexibility and growth optionality
- Very thin margins with negative gross margin and only 2.6% operating margin
- Revenue declined 5.5% year over year, pointing to limited top-line momentum
- Refining fundamentals are inherently cyclical, which can pressure earnings and cash flow volatility
Key Metrics to Watch
- Gross margin trends and refining crack spreads as indicators of commodity pricing environment
- Revenue growth trajectory and market demand for refined products
- Free cash flow sustainability and capital allocation efficiency
- Debt service capacity and leverage ratios as business cycles through downturns
- Operating margin and gross margin trend
- Free cash flow and operating cash flow durability
Valero Energy Corp./Tx (VLO) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 3.5% FCF margin may limit capital allocation flexibility.
VLO Profit Margin, ROE & Profitability Analysis
VLO vs Energy Sector: How Valero Energy Corp./Tx Compares
How Valero Energy Corp./Tx compares to Energy sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Valero Energy Corp./Tx Stock Overvalued? VLO Valuation Analysis 2026
Based on fundamental analysis, Valero Energy Corp./Tx has mixed fundamental signals relative to the Energy sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Valero Energy Corp./Tx Balance Sheet: VLO Debt, Cash & Liquidity
VLO Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Valero Energy Corp./Tx's revenue has grown significantly by 27% over the 5-year period, indicating strong business expansion. The most recent EPS of $24.92 reflects profitable operations.
VLO Revenue Growth, EPS Growth & YoY Performance
VLO Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q3 2025 | $32.2B | $364.0M | $1.14 |
| Q2 2025 | $29.9B | $119.0M | $0.37 |
| Q1 2025 | $30.3B | -$595.0M | $-1.90 |
| Q3 2024 | $32.9B | $364.0M | $1.14 |
| Q2 2024 | $34.5B | $880.0M | $2.71 |
| Q1 2024 | $31.8B | $1.2B | $3.75 |
| Q3 2023 | $38.4B | $2.6B | $7.19 |
| Q2 2023 | $34.5B | $1.9B | $5.40 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Valero Energy Corp./Tx Dividends, Buybacks & Capital Allocation
VLO SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Valero Energy Corp./Tx (CIK: 0001035002)
📋 Recent SEC Filings
❓ Frequently Asked Questions about VLO
What is the AI rating for VLO?
Valero Energy Corp./Tx (VLO) has a Combined AI Rating of HOLD from Claude (HOLD) and ChatGPT (HOLD) with 75% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are VLO's key strengths?
Claude: Strong free cash flow generation of $4.4B with 3.5% FCF margin supporting dividend and debt service. Conservative leverage with 0.35x debt-to-equity ratio and solid interest coverage of 5.7x. ChatGPT: Strong free cash flow generation of $4.35B with a 3.5% FCF margin. Healthy balance sheet with 1.65x current ratio and modest 0.35x debt-to-equity.
What are the risks of investing in VLO?
Claude: Negative gross margin of -0.2% indicates refining margins are highly compressed and vulnerable to commodity price fluctuations. Revenue decline of 5.5% YoY suggests weak demand or lower product pricing in petroleum refining markets. ChatGPT: Very thin margins with negative gross margin and only 2.6% operating margin. Revenue declined 5.5% year over year, pointing to limited top-line momentum.
What is VLO's revenue and growth?
Valero Energy Corp./Tx reported revenue of $122.7B.
Does VLO pay dividends?
Valero Energy Corp./Tx pays dividends, with $1,405.0M distributed to shareholders in the trailing twelve months.
Where can I find VLO SEC filings?
Official SEC filings for Valero Energy Corp./Tx (CIK: 0001035002) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is VLO's EPS?
Valero Energy Corp./Tx has a diluted EPS of $7.57.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is VLO a good stock to buy right now?
Based on our AI fundamental analysis in April 2026, Valero Energy Corp./Tx has a HOLD rating with 75% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is VLO stock overvalued or undervalued?
Valuation metrics for VLO: ROE of 9.9% (sector avg: 14%), net margin of 1.9% (sector avg: 12%). Compare these metrics with sector averages to assess valuation.
Should I buy VLO stock in 2026?
Our dual AI analysis gives Valero Energy Corp./Tx a combined HOLD rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is VLO's free cash flow?
Valero Energy Corp./Tx's operating cash flow is $5.8B, with capital expenditures of $1.5B. FCF margin is 3.5%.
How does VLO compare to other Energy stocks?
Vs Energy sector averages: Net margin 1.9% (avg: 12%), ROE 9.9% (avg: 14%), current ratio 1.65 (avg: 1.3).