Valero price target raised to $263 from $236 at Piper Sandler

Piper Sandler analyst Ryan Todd raised the firm’s price target on Valero (VLO) to $263 from $236 and keeps an Overweight rating on the shares. The firm is updating its estimates for Valero based on a combination of quarter-end mark-to-market on commodity pricing, as well as modest adjustments to operating assumptions. Despite robust indicators, Piper expects investors to wrestle somewhat with significant noise/volatility in margin capture in Q1/Q2, driven by a combination of various “lag” impacts and headwinds caused by the rapid increase in crude/product price, a modest headwind for Q1 margin capture. Although the firm is reducing Q1 estimates, Piper expects investors to look towards what are likely to be strong Q2 results.