VLO Should I Buy
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0.000(0.000%)
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Not a good buy right now. Despite strong Q4 results and supportive analyst targets, the near-term technical setup is weakening (bearish MACD, price below pivot) and the provided pattern-based forward-return odds skew slightly negative over the next day/week/month. For an impatient buyer who doesn’t want to wait for a cleaner entry, VLO is a HOLD rather than a fresh BUY at ~181.7.
Trend/price action: VLO closed at 181.69, below the pivot (185.62), indicating near-term momentum is leaning lower. Momentum: MACD histogram is negative (-0.646) and expanding bearishly, suggesting downside momentum is building rather than stabilizing. RSI: RSI(6) at ~40.5 is neutral-to-soft (not oversold), so there isn’t a strong mean-reversion buy signal yet. Moving averages: converging MAs imply consolidation, but with MACD deteriorating this consolidation is currently resolving bearishly. Levels: immediate support is S1 ~179.28 (a break risks a move toward S2 ~175.37). Resistance overhead sits near 185.62 (pivot) then 191.96 (R1). Short-term odds (provided): similar-pattern analysis indicates ~60% probability of mild declines (-0.96% next day, -1.64% next week, -2.44% next month), aligning with the bearish MACD.
Q4 2025 earnings beat: adjusted EPS 3.82 with higher refining margins and throughput; net income ~1.1B. Shareholder returns: dividend increased ~6%, which can support the stock. Analyst support: multiple firms reiterated/raised targets recently (e.g., Piper to 220, Scotiabank to 178, Morgan Stanley to 180, Mizuho to 197), keeping institutional interest engaged. Refining tailwinds noted by analysts: crude differential dynamics and tighter S/D expectations could sustain margins if they persist.
Event fade risk: stock reportedly hit an all-time high on earnings, but also showed late-day fading/relative lag versus peers—often a sign that good news is being digested rather than chased.
Latest quarter: 2025/Q4. Revenue decreased to 28.632B (-6.91% YoY), but profitability surged: Net income rose to 1.134B (+305% YoY) and EPS to 3.74 (+320.22% YoY). Gross margin improved to 6.61 (+228.86% YoY). Takeaway: top-line is down, but margin/earnings strength is very strong—consistent with a refining upcycle and improved crack spreads/throughput. This is fundamentally positive, but refining earnings can be cyclical and the market is focusing on 2026 margin durability.
Recent trend: price targets have generally been nudged higher into late Jan (Piper up to 220, Morgan Stanley to 180, Scotiabank to 178, Mizuho to 197), reflecting improved near-term fundamentals and cracks. However, there was a clear caution phase in Dec with downgrades to Neutral from BofA and Mizuho on valuation and 2026 crack-spread concerns. Wall Street pros/cons view: Pros—strong current profitability, shareholder returns, and potential refining/differential tailwinds. Cons—valuation sensitivity after a strong run, and risk that 2026 refining margins normalize as capacity ramps and macro/geopolitical drivers fade. Influential/political trading: no recent congress trading data available; hedge funds and insiders are reported as Neutral with no significant recent trends.
