Valero Energy Shares Jumped: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of refiner Valero Energy (NYSE: VLO  ) jumped 12% on rumors of a possible buyout offer.

So what: The U.K. Daily Mail says that Reliance Industries, out of India, is preparing to offer $48 per share for Valero. If true, that would be nearly a 100% premium even after today's bounce, but there isn't any news from either company that indicates a deal is imminent.

Now what: Buying on rumors is dangerous and many investors and analysts are brushing off this talk as having little credibility. But the rumored premium is an eye-popper if a bid does come through.

I'm not going to recommend buying on unverified information, but I'll keep an eye on the stock to see if any of this hearsay ends up having even a grain of truth.

Interested in more info on Valero Energy? Add it to your watchlist by clicking here.

Fool contributor Travis Hoium does not have a position in any company mentioned. You can follow Travis on Twitter at @FlushDrawFool, check out his personal stock holdings or follow his CAPS picks at TMFFlushDraw.

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