TGM's two-stage DCF values Valero Energy Corporation (VLO) between $492.62 and $982.38 depending on assumptions, with a base case of $681.10. Growth is taken from the company's own record (5-year revenue CAGR (FCF growth too volatile to use)), fading to 2.5% long-run; the discount rate (7.5%) reflects its beta.
What would today's price require?
$388.95 is justified only if free cash flow grows about -2.2% a year (fading to 2.5% long-run) at a 7.5% required return — slower than the company has actually grown.
| Scenario | FCF growth (fading to 2.5%) | Discount | Value / share |
|---|---|---|---|
| Conservative | 7.4%/yr | 8.5% | $492.62 |
| Base case | 10.4%/yr | 7.5% | $681.10 |
| Optimistic | 13.4%/yr | 6.5% | $982.38 |
| Third-party model estimate (FMP) | independent reference · retrieved Sep 9, 2026 · assumptions not provided | $333.75 | |
The FMP figure is a third-party point estimate. Its cash-flow forecast, discount rate, terminal growth, and valuation date are not included in the stored response, so TGMCharts presents it only as a reference—not as an intrinsic-value conclusion or price target.
Current Price
$388.95
Market-Implied Growth
-2.2%/yr
vs +10.4% 5Y actual
Model Scenario Range
$492.62 – $982.38
model output — not a price target
Edit the assumptions to see how they change the estimated fair value. Opens seeded with TGM's data-driven base case for VLO (growth from its own 5-year record, discount from its beta), so the sandbox starts where the scenarios above leave off. Illustrative model — not investment advice.
Base inputs: FCF $7.0B · 0.29B shares · net debt $5.9B
Estimated Fair Value
$681.10
+75.1% vs $388.95
How the estimated fair value shifts with the discount rate (WACC) and terminal growth, holding your 10.4%/yr FCF growth and 10-year horizon fixed. Green = above today's $388.95; red = below. Your current case is outlined.
| WACC ↓ / Terminal → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.5% | $895 | $1012 | $1166 | $1383 | $1708 |
| 6.5% | $706 | $776 | $863 | $975 | $1124 |
| 7.5% | $580 | $626 | $681 | $748 | $832 |
| 8.5% | $491 | $523 | $560 | $604 | $657 |
| 9.5% | $423 | $447 | $474 | $505 | $541 |
