Valero Energy Corporation (VLO.N): Strong 2Q Result

Research evidence excerpt

Valero Energy Corporation (VLO.N): Strong 2Q Result

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30 Jul 2026 10:05:08 ET │ 13 pages

Valero Energy Corporation (VLO.N)

Strong 2Q Result

CITI'S TAKE

VLO reported strong 2Q results with adjusted EPS of $12.54 handily beating

our $10.19 estimate and street mean of $10.08. The outperformance vs our

estimate was broad based with all three segments beating estimates. Both

Refining and Renewable Diesel exceeded throughput, capture and Opex Neutral

expectations. The Ethanol segment margins were meaningfully higher than Price (29 Jul 26 16:00) US$301.32our forecast. VLO returned ~$2.6B to shareholders in 2Q26, significantly

higher than our estimate, resulting in a payout ratio of 59% of adj net CFO. Target price US$302.00

We believe the expectation of an earnings beat this quarter and a strong 3Q Expected share price return 0.2%

is already priced into the shares and expect a muted response to the results. Expected dividend yield 1.6%

Expected total return 1.8%Refining — Total throughput of 2,950kbpd was 4%/5% above Citi/cons. GM/bbl of

$23.62 was 8%/7% above Citi/cons. Adj. EBIT of $4,444mm sharply beat Citi/cons Market Cap US$89,472M

by 19%/18%. Opex/bbl (excl D&A) of $4.70 came in 3% below both Citi/cons.

Regional Performance — In GC, throughput of 1,829kbpd came in 5%/6% above

Citi/cons and exceeded the high end of guidance. GC GM/bbl of $24.42 was Price Performance

15%/10% higher than Citi/cons of $21.20/$22.25, respectively. MC throughput of

(RIC: VLO.N, BB: VLO US)485kbpd was 4%/5% above Citi/cons, respectively, and exceeded high end of

guidance. MC GM/bbl of $20.46 matched cons but was 5% below Citi. NA

throughput of 506kbpd exceeded Citi/cons estimates by 2%/3% and exceeded high

end of guidance. NA GM/bbl of $22.02 was 2% above cons but 10% below Citi. WC