Earnings Preview: Valero Energy Corp.

Valero Energy Corp. (VLO) is expected to report Q3 earnings before market open Tuesday, October 28, with a conference call scheduled for 11:00 am.

Guidance

Analysts are looking for EPS of $1.36 on revenue of $34.43B. There is a wide EPS consensus range of 40c to $1.70, and $34.98B to $39.32B for revenue, according to First Call. When the company reported its Q2 earnings it stated it expects FY08 cap-ex to be $3.8B, down $700M from estimate.

Analyst Views

Deutsche Bank downgraded the company's shares to Hold from Buy on October 13. The firm believes Valero is disadvantaged relative to competitors from the excess of heavy oil upgrading capacity being developed. The firm also lowered its target for the company to $30 from $45. However, Valero Energy was upgraded to Outperform from Underperform at Oppenheimer on October 20.

Oppenheimer believes oil, gas and refining stocks have upside potential over the next 12 months that exceeds downside risk from a further decline in oil and gas prices by a ratio between 2 to 1 and 3 to 1. The firm upgraded a number of energy firms, including Valero, to Outperform.

Comments

[Diegojames:]

Long Valero and ignore above babble
Diego

2008 Oct 29 09:36 AM