Why Valero Energy Stock Rallied 10% in January
Shares of Valero Energy (NYSE: VLO) surged 10.3% in January, according to data provided by S&P Global Market Intelligence. That furthered its gains from 2022, when the refining stock rocketed 64%. Several catalysts fueled last month's rally, including earnings, a dividend increase, and a new low-carbon project.
Valero reported its fourth-quarter and full-year results last month. The company posted prodigious profits, as earnings tripled during the quarter and rocketed more than 10-fold for the full year. Its net income reached $3.1 billion, or $8.15 per share, in the quarter, which was $1.23 per share ahead of the analysts' consensus estimate.
Valero's refining business had its best utilization rate since 2018 at 97%, enabling it to capitalize on the wide gap between crude oil prices and refined product prices. That fueled a 230% jump in the refining segment's operating profit to $4.1 billion. Valero also profited from recent investments to grow its renewable fuel production. The company and its joint venture partner Darling Ingredients (NYSE: DAR) benefited from additional volumes from their Diamond Green Diesel (DGD) St. Charles plant expansion and the earlier-than-expected start-up of their DGD Port Arthur plant last quarter. Valero's renewable diesel earnings grew by 74% to $261 million.
Source Fool.com
