VLO US S&P 500Russell 1000 Earnings call · transcribed from the recording
Valero Energy (VLO) · Q3 2026 results and valuation
Share price: $363.71 · 2026-11-11
Valero Energy is an American company that produces and markets transportation fuels and related products. It operates refineries and production plants for renewable diesel and ethanol in the United States, Canada, and the United Kingdom. Source: Wikipedia
Results Q3 2026 vs Q2 2026 · previous quarter · published 22 Oct 2026 and 30 Jul 2026
Management sounded restrained, in its script and in answers to analysts.
1 · Numbers
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Figures not yet filed
Outlook given
2 · How management spoke
Restrained
Less upbeat than 77% of company calls
Answers to analysts: cautious, in line with the script.
Similar to last call.
3 · What stood out
Valero expects capital investments for 2026 to be approximately $2 billion.
Valuation
Is Valero Energy undervalued?
Reverse DCF on net income from the last full fiscal year (no meaningful free cash flow: a bank, insurer or a year of negative cash flow) (2025-12-31), grown for 10 years, discounted back, plus a terminal value. “Implied growth” is the rate the current price assumes.
At −11.4% growth a year (3-year revenue growth), the model's fair value is $30.50 a share — the stock trades 1092% above it. Today's price assumes 19.1% growth a year.
Current price
$363.71
close of 2026-11-11
Market implies growth of iThe yearly free-cash-flow growth, for the next 10 years, that today’s share price already assumes. If you believe the company grows faster than this, the stock is cheap under this model; slower, and it is expensive.
+19.1% for 10 yrs
Fair value / share
$30.50
Buy below
$22.88
Price vs fair value
Overvalued >200%
Price vs buy-below price
Overvalued >200%
Read between the lines
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Figure
Net income attributable to Valero stockholders increased to $6.8 billion, or $23.89 per share, from $1.1 billion, or $3.53 per share, in the third quarter of 2025.
Source quote
“For the third quarter of 2026, net income attributable to Valero stockholders was $6.8 billion, or $23.89 per share, compared to $1.1 billion, or $3.53 per share for the third quarter of 2025.”
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Key theme
The ethanol segment is expected to produce 4.9 million gallons per day in the fourth quarter.
Source quote
“Our ethanol segment is expected to produce 4.9 million gallons per day in the fourth quarter.”
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Guidance
The company maintains its long-term $4-5 billion cash target while keeping cash above the high end of that range to preserve optionality in a volatile market.
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Guidance
Valero expects capital investments for 2026 to be approximately $2 billion, providing clarity on the company's planned spending for the year.
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Figure
Operating expenses are expected to average 38 cents per gallon, which includes 4 cents per gallon for non-cash costs like depreciation and amortization.
Source quote
“Operating expenses should average 38 cents per gallon, which includes 4 cents per gallon for non-cash costs, such as depreciation and amortization.”
4 more
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Key theme
The company plans to direct all accumulated excess cash toward its owners over time.
Source quote
“So over time, all the excess cash we're accumulating will ultimately be directed towards our owners.”
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Key theme
The ethanol segment achieved a quarterly record for production in the third quarter, contributing to the company's overall performance.
Source quote
“Our ethanol segment also achieved a quarterly record for production during the third quarter, supplying fuel and contributing to our overall performance.”
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Figure
The new PTC or benefit with the 45Z is encouraging all ethanol producers to take a look at higher volumes.
Source quote
“With the new PTC or benefit with the 45Z, it's encouraging really all ethanol producers to take a look at higher volumes.”
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Figure
The company will maintain its capital allocation framework, hurdle rates, and return metrics despite holding a large amount of cash.
Source quote
“You're not going to see us, even though we're sitting in a lot of cash, we're not going to change our approach in terms of our hurdle rates and our return metrics and how we think about the capital allocation framework that we use and that we've been using for the last 10 years.”
Tone
How upbeat the language was, compared with other companiesiTone counts positive minus negative finance words, adjusted for length. Executives mostly speak positively, so the labels compare each call with every company's latest call: “typical” is the middle third, “very upbeat” the top tenth, “cautious” the bottom tenth.. Dot: Q3 2026. Ring: Q2 2026.
Script and answers carried a similar tone, so the script's message held up under questioning.
Sentences that drove the tone
“Our growth projects continue to be focused on shorter cycle opportunities that improve crude and product flexibility, optimize the value of our product mix, and maximize utilization of existing conversion...”
“We feel like this is an area to help us with our feedstock optimization, and we're looking for debottlenecking opportunities and other opportunities in that space to increase our exposure...”
“Our ethanol segment also achieved a quarterly record for production during the third quarter, supplying fuel and contributing to our overall performance.”
Full figures
Q3 2026 figures are not available yet: the company files its quarterly report (10-Q) a few weeks after the call. This page compares what management said; the figures are added when the report is filed.
Topics
Most discussed now
- New Prudently managing volatility and commodity prices
- New Valero Energy will look at ways to de- bottleneck its sort of its heavy sour capability.
- Included with the release are supplemental tables providing detailed financial information for each of Valero Energy's business segments…
- If you have any questions after reviewing these materials, please feel free to reach out to Valero Energy's Investor Relations team.
- Gulf Coast continues to be one of the most advantaged regions globally, supported by abundant domestic crude production and access...
Faded since Q2 2026
- Dropped Valero Energy has a fairly steady spend on turnaround activity, and that will continue.
- Fading On the financial side, Valero Energy's strong balance sheet remains a hallmark of its capital allocation framework.
- Fading Refining fundamentals remain supported by low global product inventories, limited excess refining capacity, and resilient demand for…
- Fading The Renewable Diesel segment reported operating income of $717 million for the second quarter of 2026, compared to an operating...
Latest announcements
Official filings, newest first. Summaries are generated from each filing and its attachment; every figure is checked against the source.
- Regulation FD disclosure; Other events · SEC 8-K
- Results of operations · SEC 8-K
Valero Energy reported net income of $6.8 billion for the third quarter of 2026, compared to $1.1 billion in the third quarter of 2025.
- Director or officer change; Regulation FD disclosure · SEC 8-K
Valero Energy Corporation expanded its board to 11 members and elected Matthew Audette to the board and Audit Committee on September 17, 2026, with a pro-rata equity grant of 372 stock units.
- Results of operations · SEC 8-K
Valero Energy Corporation issued a press release on July 30, 2026, regarding its financial and operating results for the second quarter ended June 30, 2026.
- Regulation FD disclosure · SEC 8-K
Valero authorized a new share purchase program for up to $5.0 billion on July 16, 2026, in addition to the $1.4 billion remaining from the February 2026 Program.
- Director or officer change; Shareholder vote results; Other events · SEC 8-K
- Results of operations · SEC 8-K
Valero Energy Corporation issued a press release on April 30, 2026, regarding its financial and operating results for the first quarter ended March 31, 2026.
- Material agreement · SEC 8-K
Valero Energy Corporation entered into an underwriting agreement on March 5, 2026, for the issuance and sale of $850,000,000 of its 5.150% Senior Notes due 2036.
Balance sheet & ownership
From SEC filings; short interest is FINRA data via Yahoo. Collected 2026-10-27.
Cash & runway
Cash & equivalents
$7.87B
2026-06-30
Implied runway
—
operating cash flow positive over the TTM window
Dilution
weighted-average basic shares, per quarter. Change: -5.8% YoY, -1.3% QoQ.
| Quarter | Shares |
|---|---|
| Q3 2024 | 318.0M |
| Q1 2025 | 314.0M |
| Q2 2025 | 312.0M |
| Q3 2025 | 309.0M |
| Q1 2026 | 298.0M |
| Q2 2026 | 294.0M |
Shares outstanding: 287.9M (2026-07-24)
Insider transactions
Form 4 open-market trades (codes S/P), trailing 12 months. 41 filings parsed.
Sold by insiders
41.1K shares
$9.4M · 7 transactions
Bought by insiders
0 shares
0 transactions
Net direction
net selling
Catalyst calendar
management-stated targets — from the latest earnings call; plans, not promises.
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2026
capital investments attributable to Valero
Source quote
“Turning to guidance, we still expect capital investments attributable to Valero for 2026 to be approximately $2 billion.”
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year end
completion of repairs to the Port Arthur DHT unit
Source quote
“Repairs to the Port Arthur DHT unit remain on track for completion by year end.”
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fourth quarter
refining throughput volumes
Source quote
“For modeling our fourth quarter operations, we expect refining throughput volumes to fall within the following ranges.”
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fourth quarter
refining cash operating expenses
Source quote
“We expect refining cash operating expenses in the fourth quarter to be approximately $4.85 per barrel.”
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fourth quarter
renewable diesel segment sales volumes
Source quote
“For the renewable diesel segment, we expect sales volumes of approximately 325 million gallons in the fourth quarter.”