The Dividend Daily

Oil refiner Valero Energy Corporation (VLO) on Tuesday said that it lost $489 million in the third quarter, as oil production and demand waned amid the economic recession.

The San Antonio-based company reported a third quarter net loss of $489 million, or 87 cents per share, compared with a profit of $1.2 billion, or $2.18 per share, in the year-ago period. Excluding items, its adjusted loss was 39 cents per share.

On average, Wall Street analysts expected a smaller loss of 33 cents per share.

Revenue plunged 46% from last year, to $19.5 billion. To combat worsening economic conditions, the company said it will continue to cut jobs and shutter additional refineries.

Valero shares fell 34 cents, or -1.7%, in morning trading Tuesday.

The Bottom Line
We had removed shares of VLO from our “recommended” list back on Sept.9, when they traded at $34.60. The company has a 2.96% dividend yield, based on last night’s closing stock price of $20.27. The stock has technical support in the $14-$16 price area. If the shares can bounce back from today’s tough news, we see overhead resistance around the $23-$25 price levels. We would remain on the sidelines for now.

Valero Energy Corporation (VLO) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.1 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.