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Valero Energy (VLO) Q2 Earnings and Revenues Beat Estimates
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Valero Energy Corporation (VLO - Free Report) posted adjusted second-quarter 2018 profit of $2.15 per share that surpassed the Zacks Consensus Estimate of $2.00 and the year-ago quarter’s adjusted profit of $1.23.
Valero Energy Corporation Price, Consensus and EPS Surprise
Total revenues grew 39.4% year over year to $31,015 million from $22,254 million. The top line was also above the Zacks Consensus Estimate of $28,446 million.
Higher throughput margin due to 93% throughput capacity utilization supported Valero Energy’s strong second-quarter results.
Throughput Volumes
During the quarter, refining throughput volumes were approximately 2.89 million barrels per day, down from 3.02 million barrels per day in the year- ago quarter. The figure surpassed the Zacks Consensus Estimate of 2.88 million barrels per day.
By feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 45%, 15% and 16.6%, respectively. The remaining volumes came from residuals, other feedstock, blendstocks and others.
The Gulf Coast accounted for approximately 60% of the total throughput volume. The Mid-Continent, North Atlantic and West Coast regions contributed 16.3%, 13.7% and 10.3%, respectively.
Throughput Margins
Company-wide throughput margins increased to $10.80 per barrel from the year-ago quarter’s level of $8.66 per barrel. Throughput capacity utilization of 93% during this quarter supported the outperformance.
Average throughput margin realized was $10.04 per barrel in the U.S. Gulf Coast compared with $8.20 per barrel in the prior-year quarter. The figure surpassed the Zacks Consensus Estimate of $10.34 per barrel. The metric was $13.95 per barrel in the U.S. Mid-Continent, up from $8.91 a year ago and beat the Zacks Consensus Estimate of $12.75 per barrel. Throughput margin realized was $9.33 per barrel in the North Atlantic compared with $9.39 a year ago and surpassed the Zacks Consensus Estimate of $9.74 per barrel. The metric was $12.20 per barrel in the U.S. West Coast compared with $9.93 in the prior-year quarter, which beat the Zacks Consensus Estimate of $12.05.
Refining operating expense per barrel was $3.67 compared with $3.56 in the year-ago quarter. Depreciation and amortization expenses increased 7.8% year over year to $1.79 per barrel from $1.66.
Capital Expenditure & Balance Sheet
Second-quarter capital expenditure was $718 million, including $518 million for turnarounds and catalyst expenditures. At the end of the quarter, the company had cash and temporary cash investments of $4.5 billion along with debt of $9.1 billion. Valero Energy also rewarded shareholders with dividends and share buybacks worth $672 million.
Guidance
For 2018, the company reiterated capital expenditures of $2.7 billion, in line with 2017 levels. Of this, $1.0 billion will be allocated toward growth projects and $1.7 billion for sustaining the business.
Q2 Price Performance
During the second quarter, Valero’s shares gained 19.5% compared with the industry’s 13.9% rise.
Zacks Rank & Stocks to Consider
Currently, Valero carries a Zacks Rank #3 (Hold).
A few better-ranked players in the same sector are ConocoPhillips (COP - Free Report) and China Petroleum and Chemical Corporation , also known as Sinopec, and CVR Refining, LP . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ConocoPhillips, based in Houston, TX, is a major global exploration and production (E&P) company. It pulled off an average positive earnings surprise of 226.9% in the last four quarters.
Sinopec is one of the largest petroleum and petrochemical companies in Asia. The company delivered an average positive earnings surprise of 492.8% in the trailing four quarters.
Sugar Land, TX-based CVR Refining is an independent downstream energy partnership with refining and associated logistics properties in the Midcontinent United States. The company delivered an average positive earnings surprise of 7.05% in the last four quarters.
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Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
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Valero Energy (VLO) Q2 Earnings and Revenues Beat Estimates
Valero Energy Corporation (VLO - Free Report) posted adjusted second-quarter 2018 profit of $2.15 per share that surpassed the Zacks Consensus Estimate of $2.00 and the year-ago quarter’s adjusted profit of $1.23.
Valero Energy Corporation Price, Consensus and EPS Surprise
Valero Energy Corporation Price, Consensus and EPS Surprise | Valero Energy Corporation Quote
Total revenues grew 39.4% year over year to $31,015 million from $22,254 million. The top line was also above the Zacks Consensus Estimate of $28,446 million.
Higher throughput margin due to 93% throughput capacity utilization supported Valero Energy’s strong second-quarter results.
Throughput Volumes
During the quarter, refining throughput volumes were approximately 2.89 million barrels per day, down from 3.02 million barrels per day in the year- ago quarter. The figure surpassed the Zacks Consensus Estimate of 2.88 million barrels per day.
By feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 45%, 15% and 16.6%, respectively. The remaining volumes came from residuals, other feedstock, blendstocks and others.
The Gulf Coast accounted for approximately 60% of the total throughput volume. The Mid-Continent, North Atlantic and West Coast regions contributed 16.3%, 13.7% and 10.3%, respectively.
Throughput Margins
Company-wide throughput margins increased to $10.80 per barrel from the year-ago quarter’s level of $8.66 per barrel. Throughput capacity utilization of 93% during this quarter supported the outperformance.
Average throughput margin realized was $10.04 per barrel in the U.S. Gulf Coast compared with $8.20 per barrel in the prior-year quarter. The figure surpassed the Zacks Consensus Estimate of $10.34 per barrel. The metric was $13.95 per barrel in the U.S. Mid-Continent, up from $8.91 a year ago and beat the Zacks Consensus Estimate of $12.75 per barrel. Throughput margin realized was $9.33 per barrel in the North Atlantic compared with $9.39 a year ago and surpassed the Zacks Consensus Estimate of $9.74 per barrel. The metric was $12.20 per barrel in the U.S. West Coast compared with $9.93 in the prior-year quarter, which beat the Zacks Consensus Estimate of $12.05.
Refining operating expense per barrel was $3.67 compared with $3.56 in the year-ago quarter. Depreciation and amortization expenses increased 7.8% year over year to $1.79 per barrel from $1.66.
Capital Expenditure & Balance Sheet
Second-quarter capital expenditure was $718 million, including $518 million for turnarounds and catalyst expenditures. At the end of the quarter, the company had cash and temporary cash investments of $4.5 billion along with debt of $9.1 billion. Valero Energy also rewarded shareholders with dividends and share buybacks worth $672 million.
Guidance
For 2018, the company reiterated capital expenditures of $2.7 billion, in line with 2017 levels. Of this, $1.0 billion will be allocated toward growth projects and $1.7 billion for sustaining the business.
Q2 Price Performance
During the second quarter, Valero’s shares gained 19.5% compared with the industry’s 13.9% rise.
Zacks Rank & Stocks to Consider
Currently, Valero carries a Zacks Rank #3 (Hold).
A few better-ranked players in the same sector are ConocoPhillips (COP - Free Report) and China Petroleum and Chemical Corporation , also known as Sinopec, and CVR Refining, LP . All these stocks flaunt a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
ConocoPhillips, based in Houston, TX, is a major global exploration and production (E&P) company. It pulled off an average positive earnings surprise of 226.9% in the last four quarters.
Sinopec is one of the largest petroleum and petrochemical companies in Asia. The company delivered an average positive earnings surprise of 492.8% in the trailing four quarters.
Sugar Land, TX-based CVR Refining is an independent downstream energy partnership with refining and associated logistics properties in the Midcontinent United States. The company delivered an average positive earnings surprise of 7.05% in the last four quarters.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>