Dan Gross reveals to us the surprising data point that, over the past year, Valero has outperformed Google:


Chart courtesy of MSN Money

That was surprising . . .


It’s So Fine To Be a Refiner

Who you should really hate when you fill your tank.

Daniel Gross
Slate, Thursday, Sept. 8, 2005, at 2:44 PM PT


Category: Trading

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

6 Responses to “Google or Valero?”

  1. The old adage lives: boring industries outperform the sexies!

    Ha ha ha….

  2. dude says:

    This is very interesting, but I am not sure what to make of it. Does it say something about the obscene profits of the energy sector when energy stocks outperform the wild speculation going on with Google’s stock? It could say that the price of gasoline in this country has been artificially low for decades and the energy sector is making up for lost time. Maybe it says that the speculation going on with Google isn’t as “wild” as it seems. Maybe it says that the speculation going on with the energy sector is crazier than it is with Google. I’d love to hear others’ speculation on this.

  3. Brian says:

    Especially interesting if you compare their PEs:

    VLO: 13.50
    GOOG: 91.37

    I’d say VLO is going up on valuation. GOOG on speculation.

  4. wcw says:

    Two words: refining margins. Another two: operating leverage. Need I really go on?

    And, yeah, I’m bitter I didn’t own VLO and TSO — but I was overweight energy, so I’m not all that bitter.

  5. Fred says:

    Valero has been buying up refineries at fire sale prices for twenty years. The money they have put into those refineries has set them up to use Heavy Ugly Crude. About 70% or so of their crude is heavy sour crude. It costs them about $2 more to process a barrel of Ugly but, the price difference between sour crude and sweet crude is now $12 or more.

    Valero has taken a genuinely visionary path in their industry that hasn’t been appreciated until just the last few years.

  6. Aaron says:

    VLO – pays dividend.
    GOOG – no dividend.

    No surprise that VLO is outperforming GOOG and should continue to do so as investors look for income (i.e., dividend yield). I could be worng, though…