Stock Analysis on Net
Stock Analysis on Net

Valero Energy Corp. (NYSE:VLO)

Analysis of Income Taxes

Microsoft Excel

Income Tax Expense (Benefit)

Valero Energy Corp., income tax expense (benefit), continuing operations

US$ in millions

Microsoft Excel
12 months ended: Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Country 1,804 2,147 68 (1,033) 145
U.S. state 157 153 1 9 37
U.S. 1,961 2,300 69 (1,024) 182
Country 415 766 215 (34) 186
Canadian provincial 140 312 97 (3) 100
Foreign 555 1,078 312 (37) 286
Current 2,516 3,378 381 (1,061) 468
Country 25 164 5 126 290
U.S. state (12) 80 (24) (51) (16)
U.S. 13 244 (19) 75 274
Country 69 (138) (63) 53 (28)
Canadian provincial 21 (56) (44) 30 (12)
Foreign 90 (194) (107) 83 (40)
Deferred 103 50 (126) 158 234
Income tax expense (benefit) 2,619 3,428 255 (903) 702

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Current Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations. Valero Energy Corp. current increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.
Deferred Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations. Valero Energy Corp. deferred increased from 2021 to 2022 and from 2022 to 2023.
Income tax expense (benefit) Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Valero Energy Corp. income tax expense (benefit) increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Effective Income Tax Rate (EITR)

Valero Energy Corp., effective income tax rate (EITR) reconciliation

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Statutory income tax rate 21.00% 21.00% 21.00% 21.00% 21.00%
Effective income tax rate 22.30% 22.40% 16.50% 44.90% 20.10%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Effective income tax rate Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations. Valero Energy Corp. effective income tax rate increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.

Components of Deferred Tax Assets and Liabilities

Valero Energy Corp., components of deferred tax assets and liabilities

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Tax credit carryforwards 809 660 679 681 683
Net operating losses (NOLs) 710 642 697 678 582
Inventories 237 326 217 70 141
Compensation and employee benefit liabilities 32 44 123 199 213
Environmental liabilities 59 57 53 64 69
Finance lease obligations 314 309 — — —
Operating lease liabilities 519 512 — — —
Other 130 186 149 128 156
Deferred income tax assets 2,810 2,736 1,918 1,820 1,844
Valuation allowance (1,383) (1,234) (1,262) (1,223) (1,200)
Net deferred income tax assets 1,427 1,502 656 597 644
Property, plant, and equipment (5,121) (5,022) (4,866) (4,895) (4,924)
Deferred turnaround costs (399) (369) (308) (302) (331)
Operating lease ROU assets (546) (507) — — —
Inventories (106) (234) (191) (269) (217)
Investments (423) (431) (268) (171) (122)
Other (181) (156) (233) (235) (153)
Deferred income tax liabilities (6,776) (6,719) (5,866) (5,872) (5,747)
Net deferred income tax assets (liabilities) (5,349) (5,217) (5,210) (5,275) (5,103)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Deferred income tax assets Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Valero Energy Corp. deferred income tax assets increased from 2021 to 2022 and from 2022 to 2023.
Net deferred income tax assets Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards. Valero Energy Corp. net deferred income tax assets increased from 2021 to 2022 but then slightly decreased from 2022 to 2023.
Net deferred income tax assets (liabilities) Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting. Valero Energy Corp. net deferred income tax assets (liabilities) decreased from 2021 to 2022 and from 2022 to 2023.

Deferred Tax Assets and Liabilities, Classification

Valero Energy Corp., deferred tax assets and liabilities, classification

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Deferred income tax liabilities 5,349 5,217 5,210 5,275 5,103

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Item Description The company
Deferred income tax liabilities Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent. Valero Energy Corp. deferred income tax liabilities increased from 2021 to 2022 and from 2022 to 2023.

Adjustments to Financial Statements: Removal of Deferred Taxes

Valero Energy Corp., adjustments to financial statements

US$ in millions

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Adjustment to Total Liabilities
Total liabilities (as reported) 34,532 35,514 38,071 32,132 31,328
Less: Noncurrent deferred tax liabilities, net 5,349 5,217 5,210 5,275 5,103
Total liabilities (adjusted) 29,183 30,297 32,861 26,857 26,225
Adjustment to Total Valero Energy Corporation Stockholders’ Equity
Total Valero Energy Corporation stockholders’ equity (as reported) 26,346 23,561 18,430 18,801 21,803
Less: Net deferred tax assets (liabilities) (5,349) (5,217) (5,210) (5,275) (5,103)
Total Valero Energy Corporation stockholders’ equity (adjusted) 31,695 28,778 23,640 24,076 26,906
Adjustment to Net Income (loss) Attributable To Valero Energy Corporation Stockholders
Net income (loss) attributable to Valero Energy Corporation stockholders (as reported) 8,835 11,528 930 (1,421) 2,422
Add: Deferred income tax expense (benefit) 103 50 (126) 158 234
Net income (loss) attributable to Valero Energy Corporation stockholders (adjusted) 8,938 11,578 804 (1,263) 2,656

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Valero Energy Corp., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Valero Energy Corp., adjusted financial ratios

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
Net Profit Margin
Reported net profit margin 6.10% 6.54% 0.82% -2.19% 2.24%
Adjusted net profit margin 6.17% 6.56% 0.71% -1.95% 2.45%
Financial Leverage
Reported financial leverage 2.39 2.59 3.14 2.75 2.47
Adjusted financial leverage 1.99 2.12 2.45 2.15 2.00
Return on Equity (ROE)
Reported ROE 33.53% 48.93% 5.05% -7.56% 11.11%
Adjusted ROE 28.20% 40.23% 3.40% -5.25% 9.87%
Return on Assets (ROA)
Reported ROA 14.01% 18.90% 1.61% -2.74% 4.50%
Adjusted ROA 14.17% 18.99% 1.39% -2.44% 4.93%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

Financial ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Valero Energy Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Valero Energy Corp. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Valero Energy Corp. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Valero Energy Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Valero Energy Corp., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

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Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Valero Energy Corporation stockholders 8,835 11,528 930 (1,421) 2,422
Revenues, includes excise taxes on sales by certain of foreign operations 144,766 176,383 113,977 64,912 108,324
Profitability Ratio
Net profit margin1 6.10% 6.54% 0.82% -2.19% 2.24%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Valero Energy Corporation stockholders 8,938 11,578 804 (1,263) 2,656
Revenues, includes excise taxes on sales by certain of foreign operations 144,766 176,383 113,977 64,912 108,324
Profitability Ratio
Adjusted net profit margin2 6.17% 6.56% 0.71% -1.95% 2.45%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Net profit margin = 100 × Net income (loss) attributable to Valero Energy Corporation stockholders ÷ Revenues, includes excise taxes on sales by certain of foreign operations
= 100 × 8,835 ÷ 144,766 = 6.10%

2 Adjusted net profit margin = 100 × Adjusted net income (loss) attributable to Valero Energy Corporation stockholders ÷ Revenues, includes excise taxes on sales by certain of foreign operations
= 100 × 8,938 ÷ 144,766 = 6.17%

Profitability ratio Description The company
Adjusted net profit margin An indicator of profitability, calculated as adjusted net income divided by total revenue. Valero Energy Corp. adjusted net profit margin ratio improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Financial Leverage

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Total assets 63,056 60,982 57,888 51,774 53,864
Total Valero Energy Corporation stockholders’ equity 26,346 23,561 18,430 18,801 21,803
Solvency Ratio
Financial leverage1 2.39 2.59 3.14 2.75 2.47
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Total assets 63,056 60,982 57,888 51,774 53,864
Adjusted total Valero Energy Corporation stockholders’ equity 31,695 28,778 23,640 24,076 26,906
Solvency Ratio
Adjusted financial leverage2 1.99 2.12 2.45 2.15 2.00

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 Financial leverage = Total assets ÷ Total Valero Energy Corporation stockholders’ equity
= 63,056 ÷ 26,346 = 2.39

2 Adjusted financial leverage = Total assets ÷ Adjusted total Valero Energy Corporation stockholders’ equity
= 63,056 ÷ 31,695 = 1.99

Solvency ratio Description The company
Adjusted financial leverage A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity.
Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.		 Valero Energy Corp. adjusted financial leverage ratio decreased from 2021 to 2022 and from 2022 to 2023.

Adjusted Return on Equity (ROE)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Valero Energy Corporation stockholders 8,835 11,528 930 (1,421) 2,422
Total Valero Energy Corporation stockholders’ equity 26,346 23,561 18,430 18,801 21,803
Profitability Ratio
ROE1 33.53% 48.93% 5.05% -7.56% 11.11%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Valero Energy Corporation stockholders 8,938 11,578 804 (1,263) 2,656
Adjusted total Valero Energy Corporation stockholders’ equity 31,695 28,778 23,640 24,076 26,906
Profitability Ratio
Adjusted ROE2 28.20% 40.23% 3.40% -5.25% 9.87%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROE = 100 × Net income (loss) attributable to Valero Energy Corporation stockholders ÷ Total Valero Energy Corporation stockholders’ equity
= 100 × 8,835 ÷ 26,346 = 33.53%

2 Adjusted ROE = 100 × Adjusted net income (loss) attributable to Valero Energy Corporation stockholders ÷ Adjusted total Valero Energy Corporation stockholders’ equity
= 100 × 8,938 ÷ 31,695 = 28.20%

Profitability ratio Description The company
Adjusted ROE A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity. Valero Energy Corp. adjusted ROE improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.

Adjusted Return on Assets (ROA)

Microsoft Excel
Dec 31, 2023 Dec 31, 2022 Dec 31, 2021 Dec 31, 2020 Dec 31, 2019
As Reported
Selected Financial Data (US$ in millions)
Net income (loss) attributable to Valero Energy Corporation stockholders 8,835 11,528 930 (1,421) 2,422
Total assets 63,056 60,982 57,888 51,774 53,864
Profitability Ratio
ROA1 14.01% 18.90% 1.61% -2.74% 4.50%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in millions)
Adjusted net income (loss) attributable to Valero Energy Corporation stockholders 8,938 11,578 804 (1,263) 2,656
Total assets 63,056 60,982 57,888 51,774 53,864
Profitability Ratio
Adjusted ROA2 14.17% 18.99% 1.39% -2.44% 4.93%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

2023 Calculations

1 ROA = 100 × Net income (loss) attributable to Valero Energy Corporation stockholders ÷ Total assets
= 100 × 8,835 ÷ 63,056 = 14.01%

2 Adjusted ROA = 100 × Adjusted net income (loss) attributable to Valero Energy Corporation stockholders ÷ Total assets
= 100 × 8,938 ÷ 63,056 = 14.17%

Profitability ratio Description The company
Adjusted ROA A profitability ratio calculated as adjusted net income divided by adjusted total assets. Valero Energy Corp. adjusted ROA improved from 2021 to 2022 but then slightly deteriorated from 2022 to 2023.