Valero cut to Hold at Argus amid weaker performance in Refining

As previously reported, Argus downgraded Valero to Hold from Buy. The company’s lower first-quarter earnings reflected a weaker performance within the Refining business, which saw a 12% decline in year-over-year revenues, lower refining margins falling 40% and weaker operating income that came down 57%, the analyst tells investors in a research note. Near-term growth in refinery product demand and refining margins has peaked, meaning that profit growth within the Refining sector is now likely on the downswing, but demand for gasoline, diesel, and jet fuel remains generally strong, and Valero is one of the best pure-play, large-cap names in the group, Argus adds, also boosting its FY24 EPS view on the stock to $15.36 from $14.48.