Valero Energy Corp (NYSE:VLO)

Short ALJ vs. Long VLO

VLO has positive cash flow, more geographic diversification,
low debt/equity ratio.

ALJ has high debt, has lost money on operating basis for last 3 quarters, has purchased California refineries in last year that apparently do not make money. Needs to raise money to accomplish cap ex plans over next 3 years.

Expect a wild ride for this and the whole petroleum exploration and production area, but conflict and shortages will improve Valero's long-term bottom line.

Valero is too beaten up by the recent crack spread debacle. No new refineries have been built in the US in 30 years, and Valero refineries can handle heavy crude. This is one of the few times I think Cramer is wrong.(Six months ago he was right to knock VLO).
I'm in at the low 30's.

I personally like companies where ROE exceeds P/E. I consider this as a good criteria of a good value. With ROE at 28% and P/E at 9, Valero is is a good candidate.

With high oil prices refineries definitely have tough times, but Valero seems to handle this good: its Q2 net income may shrank relative to Q2 07 (734M vs. 2.2B), but even if it stays at these levels Valero still will keep 10% ROE exceeding its P/E. And lowering oil prices will send this stock to the skies.

I see a good 80/20 risk ratio here - 80% for an upside vs. 20% for a downside. A strong buy.

Refiners margins should become favorable as oil comes down in price.

They're a giant refiner.

Latest drop in oil prices has to favor this company coming back to tue valuation. I'm betting pretty heavy.

crude now in vlo's favor

Top 50 Picks

Refiner Rally

Being hammered by sellers for no apparent reason. Price of oil has gone down. This should help the refinery stocks increase profits on a per barrel basis.

Acquisition Trading System - Buy Signal

Stock has been hammered now over the past year while oil prices have spiked. Everyone is now aware of the crack spread that is hurting this stock price. This means that the bad news is being priced in. There may be more volatility in the short term, but for long term holders, it's time to begin accumulating a position.

This is like buying a commodity at below the price of production. It's pure supply and demand. Refiners won't continue to make gasoline at a loss, therefore, they will drop production, which in turn will take supply off the market, which will in turn support price. The demand side could also fall meaning hte cutbacks won't help, but you are getting to a point in time where we are much closer to a bottom in the crack spread (worst it's been in decades) than we are to a top. It's time to invest in the crack spread...... which means a STRONG buy in VLO and other refiners.

Valero will test the HIGHS within the NEXT Couple of MONTHS.

This will HAPPEN NO MATTER WHO BECOMES PRESIDENT.

We need AIR, FOOD, and GASOLINE.

One day they will firm up, STOP wasting so much money..... need better control of retail and refining

We need more companies like this one. If they can expand in the next couple years this could be in the 3 bag range.

America is addicted to oil... and pretty much everything else they sell is the little markets where you fill up

Seems time for at least a short-term bounce for the refiners.

Good Deal. Buy;)