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Valero Energy (VLO) Outpaces Stock Market Gains: What You Should Know

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Valero Energy (VLO - Free Report) closed at $146.54 in the latest trading session, marking a +0.87% move from the prior day. This change outpaced the S&P 500's 0.4% gain on the day. At the same time, the Dow added 0.13%, and the tech-heavy Nasdaq gained 0.45%.

Heading into today, shares of the oil refiner had gained 9.13% over the past month, outpacing the Oils-Energy sector's gain of 3.39% and the S&P 500's loss of 1.38% in that time.

Investors will be hoping for strength from Valero Energy as it approaches its next earnings release, which is expected to be October 26, 2023. The company is expected to report EPS of $6.99, down 2.1% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $36.78 billion, down 17.27% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $25.32 per share and revenue of $144.95 billion. These totals would mark changes of -13.17% and -17.82%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for Valero Energy. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 6.65% higher. Valero Energy is holding a Zacks Rank of #3 (Hold) right now.

Valuation is also important, so investors should note that Valero Energy has a Forward P/E ratio of 5.74 right now. For comparison, its industry has an average Forward P/E of 7.01, which means Valero Energy is trading at a discount to the group.

Meanwhile, VLO's PEG ratio is currently 0.96. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Oil and Gas - Refining and Marketing industry currently had an average PEG ratio of 1.02 as of yesterday's close.

The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 83, putting it in the top 33% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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