Valero Energy Insider Trades Send A Signal

Revealing a significant insider sell on May 13, Paulett Eberhart, Director at Valero Energy VLO, as per the latest SEC filing.

What Happened: After conducting a thorough analysis, Eberhart sold 720 shares of Valero Energy. This information was disclosed in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday. The total transaction value is $113,850.

During Tuesday's morning session, Valero Energy shares down by 1.13%, currently priced at $154.17.

Delving into Valero Energy's Background

Valero Energy is one of the largest independent refiners in the United States. It operates 15 refineries with a total throughput capacity of 3.2 million barrels a day in the United States, Canada, and the United Kingdom. Valero also owns 12 ethanol plants with capacity of 1.6 billion gallons a year and holds a 50% stake in Diamond Green Diesel, which has capacity to produce 1.2 billion gallons per year of renewable diesel.

Financial Milestones: Valero Energy's Journey

Revenue Growth: Valero Energy's revenue growth over a period of 3 months has faced challenges. As of 31 March, 2024, the company experienced a revenue decline of approximately -12.84%. This indicates a decrease in the company's top-line earnings. As compared to its peers, the revenue growth lags behind its industry peers. The company achieved a growth rate lower than the average among peers in Energy sector.

Profitability Metrics:

• Gross Margin: The company faces challenges with a low gross margin of 6.21%, suggesting potential difficulties in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Valero Energy's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 3.75.

Debt Management: Valero Energy's debt-to-equity ratio is below the industry average at 0.42, reflecting a lower dependency on debt financing and a more conservative financial approach.

Exploring Valuation Metrics Landscape:

• Price to Earnings (P/E) Ratio: With a lower-than-average P/E ratio of 7.65, the stock indicates an attractive valuation, potentially presenting a buying opportunity.

• Price to Sales (P/S) Ratio: The current P/S ratio of 0.38 is below industry norms, suggesting potential undervaluation and presenting an investment opportunity for those considering sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): Valero Energy's EV/EBITDA ratio, lower than industry averages at 4.47, indicates attractively priced shares.

Market Capitalization Analysis: With a profound presence, the company's market capitalization is above industry averages. This reflects substantial size and strong market recognition.

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Unmasking the Significance of Insider Transactions

Insider transactions, although significant, should be considered within the larger context of market analysis and trends.

Within the legal framework, an "insider" is defined as any officer, director, or beneficial owner holding more than ten percent of a company's equity securities as per Section 12 of the Securities Exchange Act of 1934. This includes executives in the c-suite and major hedge funds. These insiders are mandated to disclose their transactions through a Form 4 filing, to be submitted within two business days of the transaction.

The initiation of a new purchase by a company insider serves as a strong indication that they expect the stock to rise.

However, insider sells may not always signal a bearish view and can be influenced by various factors.

Deciphering Transaction Codes in Insider Filings

When dissecting transactions, the focal point for investors is often those occurring in the open market, meticulously detailed in Table I of the Form 4 filing. A P in Box 3 denotes a purchase, while S signifies a sale. Transaction code C indicates the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Valero Energy's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.