Valero Energy Corporation (VLO)

FairStock Score: 73/100 — STEADY

Key Financials

AI Analysis

AI-generated, general educational analysis — not personal investment advice.

I look for durable earning power bought with a margin of safety. Valero is a large refiner with scale, but refining is a commodity business and the Lynch category given is cyclical because earnings follow the economic cycle. In fiscal Q2 2026, the quarter ended 2026-06-30, Valero reported revenue of $44.5B, net income of $3.7B, and diluted EPS of $12.62. That is a huge rebound from fiscal Q2 2025, when revenue was $29.9B, net income $714.0M, and diluted EPS $2.28. But one quarter does not make a cycle. FY2023 produced net income of $8.8B and EPS of $24.92; FY2025 produced $2.3B and EPS $7.57. FairStock calculations at the $426.76 close on 2026-10-26 show P/E 17.80, P/B 4.91, FCF yield 8.2%, debt/equity 0.40, Altman Z-Score 4.30, and Piotroski 9/9. The balance sheet and cash generation look sound, with TTM FCF of $10.1B. Still, the Graham Number is $216.40 and the FairStock margin of safety is -93.75%, so the price is far above conservative value. PEG 0.04 is flattered by cyclical profit growth. I see scale but not a wide moat. At this price, the risk is paying peak earnings for a cyclical business.

In plain English: Valero turns crude oil into gasoline, diesel and other fuels, and also makes renewable diesel and ethanol. The business looks strong right now, with large profits in the latest quarter and healthy cash generation, but it operates in a cyclical industry. At the recent price, the shares look expensive compared with the company’s reported earnings and book value, so a lot of good news is already reflected.

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Data as of 2026-10-26 close · note generated 2026-10-28 · model deepseek-flash

Sources (SEC EDGAR): fiscal Q2 2026 10-Q (period ended 2026-06-30) · fiscal Q1 2026 10-Q (period ended 2026-03-31) · fiscal Q3 2025 10-Q (period ended 2025-09-30) · fiscal Q2 2025 10-Q (period ended 2025-06-30) · FY2025 10-K (period ended 2025-12-31) · FY2024 10-K (period ended 2024-12-31) · FY2023 10-K (period ended 2023-12-31)

Fundamentals from company filings and market-data providers; prices are end-of-day, not real-time. AI-generated analysis is general and educational — not personal investment advice. Scoring methodology · Score test · Disclaimer