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Arphra AIPlain-English read on Valero Energy Corporation’s valuationOverview
Discounted cash flow
Income / accounting-based
Multiples & assets
Scenario
Toolbox
Weighted blend
$414.12
+69.15% vs spot
Strong Buy
Spot price
$244.82
Mkt cap $72.7B
subtle cardAnalyst PT consensus
$214.67
-12.32% vs spot
subtle cardMethods covered
18 / 19
9 in blend
subtle cardFootball field
VLO · fair-value range by method
Method comparison
VLO · fair value by valuation framework
| Method | Category | Fair value | Range | vs spot | Weight | Driver | Conf. |
|---|---|---|---|---|---|---|---|
| DCF · FCFF | dcf | $1,110.59 | $765.92 – $1,722.05 | +353.64% | 20.0% | WACC 6.0%, g₀=25.0%, gₗ=2.0% | high |
| DCF · FCFE | dcf | $805.18 | $586.89 – $1,153.71 | +228.88% | 11.1% | kₑ 7.0%, g₀=25.0%, gₗ=2.0% | high |
| DDM · Gordon | ddm | $94.93 | $79.12 – $118.62 | -61.23% | — | D₁ 4.66, kₑ 7.0%, gₗ 2.0% | med |
| DDM · H-model | ddm | $201.96 | $156.70 – $269.81 | -17.51% | — | D₀ 4.66, g₀=25.0%, gₗ=2.0%, H 5y | med |
| DDM · multi-stage | ddm | $156.41 | $132.95 – $179.87 | -36.11% | — | 5y schedule 25.0% → 2.0%, kₑ 7.0% | high |
| Residual income | income | $91.86 | $80.84 – $102.88 | -62.48% | 5.6% | BV 88.23, ROE 8.8% → kₑ | high |
| EVA / MVA | income | $593.76 | $522.51 – $665.01 | +142.53% | 3.3% | IC 33.6B, WACC 6.0% | high |
| P/E · sector | multiple | $90.84 | $79.94 – $101.74 | -62.90% | 11.1% | EPS 7.57 × peer P/E 12.0 | med |
| P/S · sector | multiple | $488.26 | $415.02 – $561.50 | +99.44% | — | Rev/sh 406.88 × peer P/S 1.20 | med |
| EV / EBITDA | multiple | $110.43 | $97.18 – $123.69 | -54.89% | 22.2% | EBITDA × peer 6.0× − ND 7.0B | high |
| EV / EBIT | multiple | $79.70 | $67.74 – $91.65 | -67.45% | 8.9% | EBIT × peer 7.2× − ND | med |
| EV / Sales | multiple | $391.75 | $332.99 – $450.52 | +60.02% | 6.7% | Sales × peer 1.02× − ND | med |
| PEG-anchored | multiple | $302.80 | $257.38 – $348.22 | +23.68% | — | PEG=1, fwd EPS g 265.1% | med |
| Earnings power | intrinsic | $156.37 | $137.61 – $175.14 | -36.13% | — | NOPAT / WACC, no growth | med |
| Graham revised | intrinsic | $362.21 | $307.87 – $416.54 | +47.95% | — | EPS×(8.5+2g)·4.4/Y | low |
| Lynch P/E=g | intrinsic | $189.25 | $160.86 – $217.64 | -22.70% | — | PE = g (25.0) | low |
| Book NAV | asset | $88.23 | $83.82 – $92.64 | -63.96% | 11.1% | (Assets − Liabilities) / Shares | high |
| Liquidation | asset | $35.20 | $29.92 – $40.48 | -85.62% | — | Cash 100% + non-cash 70% − Liab. | low |
| Reverse DCF | reverse | — | — | — | — | Implied g -8.7% · Pessimistic — market pricing decline | high |
Cost-of-capital build-up
CAPM cost of equity, after-tax cost of debt, WACC. Risk-free as of 2026-05-12.
| Risk-free rate (US 10y Treasury)rf | 4.46% |
| Equity beta (0.57)β | × 0.57 |
| Equity risk premiumERP | 4.46% |
| Cost of equity (CAPM)kₑ | 7.01% |
| Pre-tax cost of debtkd | 4.75% |
| Effective tax ratet | 25.2% |
| After-tax cost of debt | 3.55% |
| Equity weight$26.6B | 69.5% |
| Debt weight$11.7B | 30.5% |
| WACC | 5.95% |
Growth assumptions
Blended forward growth used as DCF default; terminal pegged to long-run nominal GDP.
| Analyst forward revenue growthFMP | 11.61% |
| Analyst forward EPS growthFMP | 265.06% |
| Historical 5y revenue CAGRFY | 1.86% |
| Historical 5y EPS CAGRFY | 35.13% |
| Sustainable g (ROE × retention)Δ | 3.54% |
| Blended near-term growth (g₀) | 25.00% |
| Terminal growth (gₗ) | 2.00% |
Sources
- FMP /analyst-estimates— 8 rows(as of 2023-12-31)
- Treasury rates · 10y— 4.46% rf(as of 2026-05-12)
- market_risk_premium · DB— 4.46% ERP(as of 2026-05-13)
- Sector multiple defaults— Energy (live sector PE unavailable)
- FMP /price-target-consensus— mean $214.67
This page is generated by a quantitative valuation engine for research purposes only and does not constitute investment advice. Methodology follows standard CFA / Damodaran frameworks; assumptions are driven by analyst consensus from Financial Modeling Prep and reported financial statements.