We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Valero Energy's Q4 Earnings Beat on Higher Renewable Diesel Margins
Read MoreHide Full Article
Valero Energy Corporation (VLO - Free Report) reported fourth-quarter 2024 adjusted earnings of 88 cents per share, which beat the Zacks Consensus Estimate of 13 cents. The bottom line, however, declined from $3.55 reported in the year-ago quarter.
Total quarterly revenues decreased from $35,414 million in the prior-year quarter to $30,756 million. The top line, however, beat the Zacks Consensus Estimate of $30,729 million.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Better-than-expected quarterly results can be primarily attributed to an increase in renewable diesel margins and lower total cost of sales. The positives were partially offset by a decline in refining margins.
Valero Energy Corporation Price, Consensus and EPS Surprise
Adjusted operating income in the Refining segment totaled $437 million, down from $1,577 million in the year-ago quarter. The figure also missed our estimate of $1,296.5 million. The segment was affected due to a significantly lower refining margin per barrel of throughput in the fourth quarter.
In the Ethanol segment, Valero reported an adjusted operating profit of $20 million, lower than $205 million reported in the prior-year quarter. The figure also missed our estimate of $84.2 million. The segment was affected due to a drop in ethanol margin per gallon of production.
Operating income in the Renewable Diesel segment totaled $170 million, higher than $84 million in the year-ago quarter. Renewable diesel sales volume, however, declined to 3,356 thousand gallons per day from 3,773 in the year-ago quarter. Our estimate for the same was pinned at 2,828 thousand gallons per day. The segment benefited from higher renewable diesel margins compared to the year-ago period.
Throughput Volumes
In the fourth quarter, Valero’s refining throughput volumes totaled 2,995 thousand barrels per day (MBbls/d), in line with the year-ago figure. Our estimate for the same was pegged at 2,688 MBbls/d.
In terms of feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 50.4%, 8% and 20.3%, respectively, of the total volume. The remaining volume came from residuals, other feedstock, and blendstocks and others.
The Gulf Coast contributed 61.1% to the total throughput volume. Mid-Continent, North Atlantic and West Coast regions accounted for 15.8%, 14.5% and 8.6%, respectively, of the total throughput volume.
Throughput Margins
The refining margin per barrel of throughput declined to $8.44 from the year-ago level of $12.89.
Refining operating expenses per barrel of throughput was $4.67 compared with $4.99 in the year-ago quarter.
Depreciation and amortization expenses decreased to $2.17 per barrel from $2.18 in the prior-year period.
Valero’s adjusted refining operating income was $1.60 per barrel of throughput compared with $5.72 a year ago.
Cost of Sales
Total cost of sales decreased to $30,127 million from the year-ago quarter’s figure of $33,540 million. The figure was also below our estimate of $30,590.1 million, primarily due to a decrease in the cost of materials and others.
Capital Investment & Balance Sheet
The fourth-quarter capital investment totaled $547 million, of which $452 million was allocated toward sustaining the business.
The company had cash and cash equivalents of $4.7 billion at the end of the fourth quarter. As of Dec. 31, 2024, it had a total debt of $8.1 billion and finance lease obligations of $2.4 billion.
Sunoco LP is one of the largest distributors of motor fuel in the United States. The partnership distributes fuel to independent dealers, commercial customers, convenience stores and distributors. Its current distribution yield is greater than that of the industry's composite stocks, providing unitholders with consistent returns.
Equinor ASA is one of the leading integrated energy companies globally and the second-largest supplier of natural gas in Europe. The company’s expansion in the renewable energy space positions it for long-term growth as more and more countries transition toward cleaner energy solutions to meet their climate goals. Its strategic pivot toward low-carbon energy solutions unlocks new revenue streams in the growing market for clean energy and carbon management solutions.
Cheniere Energy is involved in LNG-related businesses, which include LNG terminals and natural gas marketing. The company has achieved a milestone with the first production from the first LNG train of its Corpus Christi Stage 3 Liquefaction Project. The project, which includes seven midscale LNG trains, aims to expand the production capacity of the Corpus Christi Liquefaction facility. This expansion is expected to enhance Cheniere's position in the rapidly growing global LNG market, enabling it to meet the rising demand for LNG, both in the United States and internationally.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Valero Energy's Q4 Earnings Beat on Higher Renewable Diesel Margins
Valero Energy Corporation (VLO - Free Report) reported fourth-quarter 2024 adjusted earnings of 88 cents per share, which beat the Zacks Consensus Estimate of 13 cents. The bottom line, however, declined from $3.55 reported in the year-ago quarter.
Total quarterly revenues decreased from $35,414 million in the prior-year quarter to $30,756 million. The top line, however, beat the Zacks Consensus Estimate of $30,729 million.
Find the latest EPS estimates and surprises on Zacks Earnings Calendar.
Better-than-expected quarterly results can be primarily attributed to an increase in renewable diesel margins and lower total cost of sales. The positives were partially offset by a decline in refining margins.
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 $437 million, down from $1,577 million in the year-ago quarter. The figure also missed our estimate of $1,296.5 million. The segment was affected due to a significantly lower refining margin per barrel of throughput in the fourth quarter.
In the Ethanol segment, Valero reported an adjusted operating profit of $20 million, lower than $205 million reported in the prior-year quarter. The figure also missed our estimate of $84.2 million. The segment was affected due to a drop in ethanol margin per gallon of production.
Operating income in the Renewable Diesel segment totaled $170 million, higher than $84 million in the year-ago quarter. Renewable diesel sales volume, however, declined to 3,356 thousand gallons per day from 3,773 in the year-ago quarter. Our estimate for the same was pinned at 2,828 thousand gallons per day. The segment benefited from higher renewable diesel margins compared to the year-ago period.
Throughput Volumes
In the fourth quarter, Valero’s refining throughput volumes totaled 2,995 thousand barrels per day (MBbls/d), in line with the year-ago figure. Our estimate for the same was pegged at 2,688 MBbls/d.
In terms of feedstock composition, sweet crude, medium/light sour crude and heavy sour crude accounted for 50.4%, 8% and 20.3%, respectively, of the total volume. The remaining volume came from residuals, other feedstock, and blendstocks and others.
The Gulf Coast contributed 61.1% to the total throughput volume. Mid-Continent, North Atlantic and West Coast regions accounted for 15.8%, 14.5% and 8.6%, respectively, of the total throughput volume.
Throughput Margins
The refining margin per barrel of throughput declined to $8.44 from the year-ago level of $12.89.
Refining operating expenses per barrel of throughput was $4.67 compared with $4.99 in the year-ago quarter.
Depreciation and amortization expenses decreased to $2.17 per barrel from $2.18 in the prior-year period.
Valero’s adjusted refining operating income was $1.60 per barrel of throughput compared with $5.72 a year ago.
Cost of Sales
Total cost of sales decreased to $30,127 million from the year-ago quarter’s figure of $33,540 million. The figure was also below our estimate of $30,590.1 million, primarily due to a decrease in the cost of materials and others.
Capital Investment & Balance Sheet
The fourth-quarter capital investment totaled $547 million, of which $452 million was allocated toward sustaining the business.
The company had cash and cash equivalents of $4.7 billion at the end of the fourth quarter. As of Dec. 31, 2024, it had a total debt of $8.1 billion and finance lease obligations of $2.4 billion.
VLO’s Zacks Rank and Key Picks
VLO currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the energy sector are Sunoco LP (SUN - Free Report) , Equinor ASA (EQNR - Free Report) and Cheniere Energy, Inc. (LNG - Free Report) . Sunoco and Equinor currently sport a Zacks Rank #1 (Strong Buy) each, while Cheniere Energy carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco LP is one of the largest distributors of motor fuel in the United States. The partnership distributes fuel to independent dealers, commercial customers, convenience stores and distributors. Its current distribution yield is greater than that of the industry's composite stocks, providing unitholders with consistent returns.
Equinor ASA is one of the leading integrated energy companies globally and the second-largest supplier of natural gas in Europe. The company’s expansion in the renewable energy space positions it for long-term growth as more and more countries transition toward cleaner energy solutions to meet their climate goals. Its strategic pivot toward low-carbon energy solutions unlocks new revenue streams in the growing market for clean energy and carbon management solutions.
Cheniere Energy is involved in LNG-related businesses, which include LNG terminals and natural gas marketing. The company has achieved a milestone with the first production from the first LNG train of its Corpus Christi Stage 3 Liquefaction Project. The project, which includes seven midscale LNG trains, aims to expand the production capacity of the Corpus Christi Liquefaction facility. This expansion is expected to enhance Cheniere's position in the rapidly growing global LNG market, enabling it to meet the rising demand for LNG, both in the United States and internationally.