What Does the Middle East Conflict Mean for Valero Energy Stock?

• Valero Energy (VLO) is the largest independent U.S. refiner.
• Shares are up more than 90% over the past 52 weeks.
• VLO stock has strong technical momentum and is trading at new all-time highs.
• Valero maintains a 100% “Buy” opinion from Barchart, but Middle East uncertainty clouds any projections. 

Today’s Featured Stock

Valued at $68.8 billion, Valero Energy (VLO) is the largest independent refiner and marketer of petroleum products in the United States. It has refineries located throughout the United States, Canada, and the United Kingdom. 

What I’m Watching

I found today’s Chart of the Day by using Barchart’s powerful screening functions to sort for stocks with the highest technical buy signals; superior current momentum in both strength and direction; and a Trend Seeker “buy” signal. I then used Barchart’s Flipcharts feature to review the charts for consistent price appreciation. VLO checks those boxes. Since the Trend Seeker issued a new “Buy” on Jan. 6, shares are up 29.46%. 

Barchart Technical Indicators for Valero Energy

Editor’s Note: The technical indicators below are updated live during the session every 20 minutes and can therefore change each day as the market fluctuates. The indicator numbers shown below therefore may not match what you see live on the Barchart.com website when you read this report. These technical indicators form the Barchart Opinion on a particular stock.

Valero Energy scored an all-time high of $232.71 on March 5.

• Valero has a Weighted Alpha of +96.33.
• VLO has an 100% “Buy” opinion from Barchart.
• The stock has gained 90.18% over the past 52 weeks.
• Valero has its Trend Seeker “Buy” signal intact.
• The stock recently traded at $228.84 with a 50-day moving average of $189.38.
• VLO has made 8 new highs and is up 19.27% over the past month.
• Relative Strength Index (RSI) is at 78.97.
• There’s a technical support level around $219.37.

Don’t Forget the Fundamentals

• $68.8 billion market capitalization.
• 20.44x trailing price-earnings ratio.
• 2.08% dividend yield.
• Revenue and earnings projections are unreliable because of ongoing conflict in the Middle East.

Analyst and Investor Sentiment on Valero Energy

• The Wall Street analysts followed by Barchart gave the stock 12 “Strong Buy,” 1 “Moderate Buy,” and 9 “Hold” opinions with price targets between $145 and $220.
• Value Line rates the stock “Above Average” with price targets between $97 and $243. That’s a wide range!
• CFRA’s MarketScope rates the stock a “Buy” with a price target of $230.
• Morningstar thinks the stock is 51% overvalued with a fair value of $144.
• 9,649 investors following the stock on Motley Fool think it will beat the market while 697 think it won’t.
• 91,910 investors are following the stock on Seeking Alpha, which rates it a “Buy.”
• Short interest is 3.84% of the float with 3.87 days to cover the float.

The Bottom Line on Valero Energy

Your guess is as good as anyone’s on Valero. This is a solid energy stock, but you can’t ignore the Middle East uncertainty.

Additional disclosure: The Barchart Chart of the Day highlights stocks that are experiencing exceptional current price appreciation. They are not intended to be buy recommendations as these stocks are extremely volatile and speculative. Should you decide to add one of these stocks to your investment portfolio it is highly suggested you follow a predetermined diversification and moving stop loss discipline that is consistent with your personal investment risk tolerance.