Why Valero’s Valuations Are Lower despite Its 1Q17 Earnings Beat
Valero Energy (VLO) is currently trading at a forward PE (price-to-earnings ratio) of 12.5x, below its peer average of 15.3x.
Valero (VLO) posted its 1Q17 earnings results on April 25, 2017. On the day, VLO’s implied volatility fell to 17.3%, compared to 22.9% on the previous day. Its stock price fell 1.5%.
Valero has been rated by a total of 21 analysts. Of this total, 12 analysts (or 57%) have given the stock “buy” or “strong buy” ratings, and nine (or 43%) have given it “hold” ratings.
Valero Energy (VLO) announced its results before the market opened on April 25, 2017. The stock received a positive opening.
In 1Q17, Valero Energy (VLO) noted a rise in its GRM (gross refining margin) to $8.1 per barrel, compared to $7.7 per barrel in 1Q16.
Valero Energy (VLO) posted its 1Q17 results on April 25, 2017. Before we proceed with an earnings review, let’s quickly examine VLO’s 1Q17 performance versus its estimates.
Institutional holdings in Phillips 66 (PSX) are at ~71.0%. That suggests the confidence level that sophisticated market participants have in the stock.
Implied volatility in Phillips 66 (PSX) stands at 19.4%. It has risen from 16.0% on March 30, 2017.
Phillips 66 (PSX) has seen a 5.0% fall in its short interest volumes since the end of March 2017.
Since January 3, 2017, Phillips 66 (PSX) stock has fallen 13.2%. Crude oil prices have fallen 3.6%.
Phillips 66 has been rated by 19 analysts. Of those, four (or 21.0%) have given it a “buy” or “strong buy” rating.
In 4Q16, Phillips 66’s (PSX) total adjusted net income of $83.0 million fell 88.0% YoY (year-over-year) and 85.0% QoQ (quarter-over-quarter).
Phillips 66 (PSX) is expected to post its 1Q17 results on April 28, 2017. In 4Q16, PSX’s revenues exceeded Wall Street analysts’ estimates by 5.0%.
Short interest in MPC has surged from 0.4% to 2.3% between mid-March and mid-April 2017.
Of the 19 analysts covering MPC, 17 (89%) analysts have assigned “buy” or “strong buy” ratings, while two (11%) have assigned “hold” ratings.
The implied volatility in Marathon Petroleum (MPC) stock currently stands at 30%, which has risen from its level of 27% on March 30, 2017.
Marathon Petroleum’s 90-day beta stood at 1.9 on April 13, 2017.
MPC’s operating income rose 64% YoY to $553 million in 4Q16. The Refining segment’s operating income rose to $219 million in 4Q16 from $179 million in 4Q15.
Marathon Petroleum stock has plunged 7% year-to-date. Due to its falling price in 1Q17, the stock has broken below its 50-day moving average.
MPC is expected to post EPS of -$0.03 in 1Q17, as compared to its EPS of $0.06 in 1Q16. MPC’s revenues are estimated to be 19% higher than its 1Q16 revenues.