Back to top

Image: Shutterstock

Valero (VLO) Sees Winter Storm Uri Impact on Q1 Bottom Line

Read MoreHide Full Article

Valero Energy Corporation (VLO - Free Report) has provided a glimpse of its preliminary financial information about the March quarter of this year.

The international manufacturer and marketer of transportation fuels and petrochemical products added that its refining and ethanol business segments were impacted significantly by a severe winter and ice storm, dubbed unofficially as Winter Storm Uri. Notably, the storm, which caused havoc to power systems in Texas, led the company to predict higher than expected incurrence of costs associated to natural gas and electricity through the first quarter of 2021 by its refining and ethanol units.

The company has made the estimation of the excess energy costs in the range of $520 million to $535 million. The company added that the excess costs mostly affected its refining businesses across the U.S. Gulf Coast region and U.S. Mid-Continent region. Following the severe impact of the winter storm, Valero Energy now projects first-quarter net loss attributable to its stockholders in the band of $1.81 to $2.05 per share.

Other energy players that expressed concerns regarding winter storms’ effect on their first-quarter 2021 bottom lines are Exxon Mobil Corporation (XOM - Free Report) and Phillips 66 (PSX - Free Report) . ExxonMobil recently expressed concerns regarding the Texas winter storm having hit its first-quarter 2021 earnings by as much as $800 million. Moreover, Phillips 66 announced that its operations in the Central and Gulf Coast regions were significantly affected by severe winter storms.

Currently, Valero Energy carries a Zacks Rank #2 (Buy). Meanwhile, another prospective player in the energy sector is Diamondback Energy, Inc. (FANG - Free Report) . The stock sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Diamondback is likely to see earnings growth of 112.5% in 2021.

Zacks Names “Single Best Pick to Double

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

You know this company from its past glory days, but few would expect that it’s poised for a monster turnaround. Fresh from a successful repositioning and flush with A-list celeb endorsements, it could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in a little more than 9 months and Nvidia which boomed +175.9% in one year.

Free: See Our Top Stock and 4 Runners Up >>

Published in