Valero Energy Boosts Shareholder Returns with Dividend Hike

As January draws to a close, Valero Energy has delivered a positive message to its investors. The U.S. energy corporation announced an increase to its quarterly cash distribution, reinforcing confidence in its financial position ahead of its upcoming annual earnings release.

All eyes are now on Thursday, January 29, when Valero is scheduled to publish financial data for the fourth quarter and the full 2025 fiscal year. Market expectations are elevated. On average, analysts project earnings per share (EPS) of approximately $3.05 for the quarter, which would represent significant year-over-year growth. Revenue is anticipated to fall within a range of $28.2 to $28.9 billion. This follows a strong third quarter where the company substantially outperformed forecasts.

The forthcoming earnings conference will offer management a platform to detail future prospects and capital allocation plans. Investors will be scrutinizing the company's strategic direction, which extends beyond traditional refining to include investments in renewable diesel and sustainable aviation fuels.

Should investors sell immediately? Or is it worth buying Valero Energy?

Dividend Raised Ahead of Earnings

In a separate move, Valero's board of directors approved an increase in the regular quarterly dividend from $1.13 to $1.20 per share. This 6.2% rise underscores the firm's longstanding commitment to returning capital to shareholders. The company has now maintained an unbroken dividend payment streak for 37 consecutive years.

The new dividend annualizes to a rate of $4.80 per share. Shareholders of record as of February 5 will receive the increased payment on March 9. This announcement comes at a time when Valero's stock price is trading robustly, hovering near recent all-time highs.

For the investment community, this combination of immediate enhanced income and the imminent fundamental business update presents a dual focus. The dividend hike serves as a near-term reward, while the quarterly report will provide critical insight into the operational and strategic drivers behind the company's performance.