The 10-second takeaway
For the quarter ended June 30 (Q2), Valero Energy beat expectations on revenues and beat expectations on earnings per share.
Compared to the prior-year quarter, revenue contracted slightly. Non-GAAP earnings per share dropped significantly. GAAP earnings per share dropped significantly.
Margins contracted across the board.
Valero Energy logged revenue of $34.03 billion. The five analysts polled by S&P Capital IQ wanted to see a top line of $30.18 billion on the same basis. GAAP reported sales were the same as the prior-year quarter's.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $0.96. The 14 earnings estimates compiled by S&P Capital IQ anticipated $0.94 per share. Non-GAAP EPS of $0.96 for Q2 were 36% lower than the prior-year quarter's $1.50 per share. GAAP EPS of $0.85 for Q2 were 43% lower than the prior-year quarter's $1.50 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 4.2%, 140 basis points worse than the prior-year quarter. Operating margin was 2.4%, 160 basis points worse than the prior-year quarter. Net margin was 1.4%, 100 basis points worse than the prior-year quarter. (Margins calculated in GAAP terms.)
Next quarter's average estimate for revenue is $32.95 billion. On the bottom line, the average EPS estimate is $1.38.
Next year's average estimate for revenue is $123.04 billion. The average EPS estimate is $4.42.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 4,365 members out of 4,557 rating the stock outperform, and 192 members rating it underperform. Among 974 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 944 give Valero Energy a green thumbs-up, and 30 give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Valero Energy is outperform, with an average price target of $46.40.
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Seth Jayson had no position in any company mentioned here at the time of publication. You can view his stock holdings here. He is co-advisor of Motley Fool Hidden Gems, which provides new small-cap ideas every month, backed by a real-money portfolio. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.