Insider Decision: Jason W Fraser Offloads $930K Worth Of Valero Energy Stock

It was reported on January 22, that Jason W Fraser, EVP & CFO at Valero Energy VLO executed a significant insider sell, according to an SEC filing.

What Happened: Fraser's decision to sell 7,427 shares of Valero Energy was revealed in a Form 4 filing with the U.S. Securities and Exchange Commission on Monday. The total value of the sale is $930,120.

Valero Energy's shares are actively trading at $129.74, experiencing a up of 0.48% during Tuesday's morning session.

Get to Know Valero Energy Better

Valero Energy is one of the largest independent refiners in the United States. It operates 15 refineries with a total throughput capacity of 3.2 million barrels a day in the United States, Canada, and the United Kingdom. Valero also owns 12 ethanol plants with capacity of 1.6 billion gallons of ethanol a year and holds a 50% stake in Diamond Green Diesel, which has capacity to produce 1.2 billion gallons per year of renewable diesel.

Breaking Down Valero Energy's Financial Performance

Decline in Revenue: Over the 3 months period, Valero Energy faced challenges, resulting in a decline of approximately -13.61% in revenue growth as of 30 September, 2023. This signifies a reduction in the company's top-line earnings. When compared to others in the Energy sector, the company faces challenges, achieving a growth rate lower than the average among peers.

Interpreting Earnings Metrics:

• Gross Margin: The company shows a low gross margin of 9.79%, suggesting potential challenges in cost control and profitability compared to its peers.

• Earnings per Share (EPS): Valero Energy's EPS is significantly higher than the industry average. The company demonstrates a robust bottom-line performance with a current EPS of 7.49.

Debt Management: Valero Energy's debt-to-equity ratio is below the industry average at 0.44, reflecting a lower dependency on debt financing and a more conservative financial approach.

Valuation Metrics: A Closer Look

• Price to Earnings (P/E) Ratio: The Price to Earnings ratio of 4.4 is lower than the industry average, indicating potential undervaluation for the stock.

• Price to Sales (P/S) Ratio: With a lower-than-average P/S ratio of 0.31, the stock presents an attractive valuation, potentially signaling a buying opportunity for investors interested in sales performance.

• EV/EBITDA Analysis (Enterprise Value to its Earnings Before Interest, Taxes, Depreciation & Amortization): The company's EV/EBITDA ratio of 2.8 trails industry averages, indicating a potential disparity in market valuation that could be advantageous for investors.

Market Capitalization: Exceeding industry standards, the company's market capitalization places it above industry average in size relative to peers. This emphasizes its significant scale and robust market position.

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Illuminating the Importance of Insider Transactions

Insider transactions are not the sole determinant of investment choices, but they are a factor worth considering.

In legal terms, an "insider" refers to any officer, director, or beneficial owner of more than ten percent of a company's equity securities registered under Section 12 of the Securities Exchange Act of 1934. This can include executives in the c-suite and large hedge funds. These insiders are required to let the public know of their transactions via a Form 4 filing, which must be filed within two business days of the transaction.

When a company insider makes a new purchase, that is an indication that they expect the stock to rise.

Insider sells, on the other hand, can be made for a variety of reasons, and may not necessarily mean that the seller thinks the stock will go down.

Navigating the World of Insider Transaction Codes

Delving into transactions, investors typically prioritize those unfolding in the open market, as precisely outlined in Table I of the Form 4 filing. A P in Box 3 indicates a purchase, while S signifies a sale. Transaction code C signals the conversion of an option, and transaction code A denotes a grant, award, or other acquisition of securities from the company.

Check Out The Full List Of Valero Energy's Insider Trades.

This article was generated by Benzinga's automated content engine and reviewed by an editor.