Valero Q3 2026 Earnings: Record $23.90 EPS as Its Refining Margin Triples, and Why the Stock Fell

Valero reported record third-quarter adjusted earnings of $23.90 a share on Thursday, October 22, against $3.66 a year earlier and the $21.07 analysts expected, according to LSEG data cited by Reuters. Its refining margin rose to $39.24 a barrel from $13.14, about three times as much, as disruptions from the Middle East conflict pushed refining margins higher, Reuters reported.

The results reached the MoveSurge news feed at 06:30:00 ET with the stock at $445.20 in thin premarket trading. A minute later it traded at $440.02, down 1.16%, and ten minutes after the headline it was at $446.91, up 0.38%. Reuters reported a 2.6% premarket gain. By 10:38 ET the stock was at $422.20, down 3.33% from Wednesday's close, according to Yahoo Finance. Marathon Petroleum, Phillips 66 and PBF Energy were down 2.12%, 2.35% and 2.44% at the same time, while US crude oil futures rose 1.59%, so most of the decline was shared across refiners.

How Valero earned $39 on each barrel

A refiner's margin is the gap between what it pays for crude oil and what it receives for the fuels it makes from it. Valero's refining margin was $10,730 million in the quarter, against $3,731 million a year earlier. Operating costs excluding depreciation rose only to $5.03 a barrel from $4.71, so almost all of the extra margin reached operating income, which rose to $8,782 million from $1,610 million. The 3-2-1 crack spread, a common gauge that compares the price of three barrels of crude with two barrels of gasoline and one of diesel, rose more than 150% on average from a year earlier, according to Reuters.

Valero refined less oil than a year ago

Throughput averaged 2,972 thousand barrels a day, down from 3,087 thousand. The drop came on the West Coast, where throughput fell to 119 thousand barrels a day from 259 thousand after Valero idled its Benicia refinery in California. The Gulf Coast and Mid-Continent refineries ran slightly more crude than a year earlier, and chief executive Lane Riggs said the refineries "operated at near-record utilization rates." The rise in profit came from the higher margin on each barrel.

The rest of the business and the balance sheet

Renewable diesel earned $353 million of operating income, against a $28 million loss a year earlier. Ethanol earned $272 million, up from $183 million, on record production of 4,799 thousand gallons a day. Net cash from operating activities was $6,932 million. Valero paid a dividend of $1.20 a share and said its payout to shareholders equaled 52% of adjusted operating cash flow. It ended September with $9,840 million of cash and $8,579 million of debt, after repaying $526 million of notes during the quarter. The release gave no forecast for fourth-quarter throughput.

Adjusted EPS of $23.90 topped both the $21.28 Zacks consensus and the $21.07 LSEG figure. Revenue of $46.1 billion compared with a Zacks consensus of $37.39 billion, according to AP.