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Valero (VLO) Q2 Earnings & Revenues Beat on Estimates, Fall Y/Y
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Valero Energy Corporation (VLO - Free Report) reported second-quarter 2024 adjusted earnings of $2.71 per share, which beat the Zacks Consensus Estimate of $2.61. However, the bottom line declined from $5.40 reported in the year-ago quarter.
Total quarterly revenues decreased from $34,509 million in the prior-year quarter to $34,490 million. The top line, however, beat the Zacks Consensus Estimate of $34,370 million.
The better-than-expected quarterly results were primarily driven by an increase in refining throughput volumes. This was partially offset by a lower refining margin per barrel of throughput, coupled with increased total cost of sales.
Valero Energy Corporation Price, Consensus and EPS Surprise
Adjusted operating income in the Refining segment totaled $1,224 million, down from $2,432 million in the year-ago quarter. The figure also missed our estimate of $2,089.1 million. A lower refining margin per barrel of throughput affected the segment.
In the Ethanol segment, Valero reported an adjusted operating profit of $105 million, which was lower than the year-ago quarter’s figure of $127 million. The figure also missed our estimate of $130.9 million. A lower ethanol margin per gallon of production affected the segment.
Operating income in the Renewable Diesel segment declined to $112 million from $440 million in the year-ago quarter. Renewable diesel sales volume decreased to 3,492 thousand gallons per day from 4,400 a year ago. The figure also missed our estimate of 4,424 thousand gallons per day. The segment was affected due to lower sales volumes resulting from planned maintenance activities and lower renewable diesel margins.
Throughput Volumes
In the second quarter, Valero’s refining throughput volumes totaled 3,010 thousand barrels per day (MBbls/d), up from 2,969 MBbls/d in the prior-year period.
In terms of feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 58.3%, 10.1% and 19.8%, respectively, of the total volume. The remaining volume came from residuals, other feedstock, and blendstocks and others.
The Gulf Coast contributed 60.7% to the total throughput volume. Mid-Continent, North Atlantic and West Coast regions accounted for 14.6%, 15.6% and 9.2%, respectively, of the total throughput volume.
Throughput Margins
The refining margin per barrel of throughput declined to $14.86 from the year-ago level of $20.81.
Refining operating expenses per barrel of throughput was $7.92 compared with $6.97 in the year-ago quarter.
Depreciation and amortization expenses decreased to $2.86 per barrel from $3.03 in the prior-year period.
As such, Valero’s adjusted refining operating income was $4.08 per barrel of throughput compared with $10.81 in the prior-year quarter.
Cost of Sales
Total cost of sales increased to $33,051 million from the year-ago figure of $31,528 million. The figure was also higher than our estimate of $31,262.4 million, primarily due to higher material costs.
Capital Investment & Balance Sheet
The second-quarter capital investment totaled $420 million, of which $329 million was allotted for sustaining the business.
The company had cash and cash equivalents of $5,246 million at the end of the second quarter. As of Jun 30, 2024, it had total debt and finance lease obligations of $10,741 million.
Sunoco is a leading wholesale motor fuel distributor in the United States, boasting a vast distribution network spanning 40 states. With long-term contracts servicing more than 10,000 convenience stores, it distributes over 10 fuel brands, ensuring a stable revenue stream. SUN currently has a Value Score of A.
The Zacks Consensus Estimate for 2024 and 2025 earnings per unit is pegged at $7.29 and $7.26, respectively. The partnership has witnessed upward earnings estimate revisions for 2025 in the past seven days.
SM Energy is set to expand its oil-centered operations in the coming years, with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.30. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past seven days.
Hess is a leading oil and natural gas exploration and production company that made several world-class oil discoveries in the Stabroek Block, located off the coast of Guyana. The company is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. The merger will likely result in the creation of an energy behemoth with a massive portfolio of producing assets.
The Zacks Consensus Estimate for HES’ 2024 EPS is pegged at $10.98. The company has a Zacks Style Score of A for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
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Valero (VLO) Q2 Earnings & Revenues Beat on Estimates, Fall Y/Y
Valero Energy Corporation (VLO - Free Report) reported second-quarter 2024 adjusted earnings of $2.71 per share, which beat the Zacks Consensus Estimate of $2.61. However, the bottom line declined from $5.40 reported in the year-ago quarter.
Total quarterly revenues decreased from $34,509 million in the prior-year quarter to $34,490 million. The top line, however, beat the Zacks Consensus Estimate of $34,370 million.
The better-than-expected quarterly results were primarily driven by an increase in refining throughput volumes. This was partially offset by a lower refining margin per barrel of throughput, coupled with increased total cost of sales.
Valero Energy Corporation Price, Consensus and EPS Surprise
Valero Energy Corporation price-consensus-eps-surprise-chart | Valero Energy Corporation Quote
Segmental Performance
Adjusted operating income in the Refining segment totaled $1,224 million, down from $2,432 million in the year-ago quarter. The figure also missed our estimate of $2,089.1 million. A lower refining margin per barrel of throughput affected the segment.
In the Ethanol segment, Valero reported an adjusted operating profit of $105 million, which was lower than the year-ago quarter’s figure of $127 million. The figure also missed our estimate of $130.9 million. A lower ethanol margin per gallon of production affected the segment.
Operating income in the Renewable Diesel segment declined to $112 million from $440 million in the year-ago quarter. Renewable diesel sales volume decreased to 3,492 thousand gallons per day from 4,400 a year ago. The figure also missed our estimate of 4,424 thousand gallons per day. The segment was affected due to lower sales volumes resulting from planned maintenance activities and lower renewable diesel margins.
Throughput Volumes
In the second quarter, Valero’s refining throughput volumes totaled 3,010 thousand barrels per day (MBbls/d), up from 2,969 MBbls/d in the prior-year period.
In terms of feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 58.3%, 10.1% and 19.8%, respectively, of the total volume. The remaining volume came from residuals, other feedstock, and blendstocks and others.
The Gulf Coast contributed 60.7% to the total throughput volume. Mid-Continent, North Atlantic and West Coast regions accounted for 14.6%, 15.6% and 9.2%, respectively, of the total throughput volume.
Throughput Margins
The refining margin per barrel of throughput declined to $14.86 from the year-ago level of $20.81.
Refining operating expenses per barrel of throughput was $7.92 compared with $6.97 in the year-ago quarter.
Depreciation and amortization expenses decreased to $2.86 per barrel from $3.03 in the prior-year period.
As such, Valero’s adjusted refining operating income was $4.08 per barrel of throughput compared with $10.81 in the prior-year quarter.
Cost of Sales
Total cost of sales increased to $33,051 million from the year-ago figure of $31,528 million. The figure was also higher than our estimate of $31,262.4 million, primarily due to higher material costs.
Capital Investment & Balance Sheet
The second-quarter capital investment totaled $420 million, of which $329 million was allotted for sustaining the business.
The company had cash and cash equivalents of $5,246 million at the end of the second quarter. As of Jun 30, 2024, it had total debt and finance lease obligations of $10,741 million.
Zacks Rank & Stocks to Consider
Valero currently carries a Zacks Rank #4 (Sell).
Investors interested in the energy sector may look at some better-ranked stocks like Sunoco LP (SUN - Free Report) , SM Energy Company (SM - Free Report) and Hess Corporation (HES - Free Report) . While Sunoco and SM Energy currently sport a Zacks Rank #1 (Strong Buy) each, Hess carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco is a leading wholesale motor fuel distributor in the United States, boasting a vast distribution network spanning 40 states. With long-term contracts servicing more than 10,000 convenience stores, it distributes over 10 fuel brands, ensuring a stable revenue stream. SUN currently has a Value Score of A.
The Zacks Consensus Estimate for 2024 and 2025 earnings per unit is pegged at $7.29 and $7.26, respectively. The partnership has witnessed upward earnings estimate revisions for 2025 in the past seven days.
SM Energy is set to expand its oil-centered operations in the coming years, with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.30. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past seven days.
Hess is a leading oil and natural gas exploration and production company that made several world-class oil discoveries in the Stabroek Block, located off the coast of Guyana. The company is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. The merger will likely result in the creation of an energy behemoth with a massive portfolio of producing assets.
The Zacks Consensus Estimate for HES’ 2024 EPS is pegged at $10.98. The company has a Zacks Style Score of A for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.