Cramer is an entertainer, not an investment advisor.
I have owned VLO for a few years. There were two main reasons I chose it versus other refiners:
1) VLO has invested in upgrading refineries to be able to handle lower grades of crude. Since lower grade crude is a cheaper input, they can earn larger margins long term. That is a sustainable competitive advantage.
2) Valuation. VLO is not nearly as cheap as when I bought it, but still reasonable.
VLO has beaten analyst estimates for each of the last 4 quarters. Estimates are still rising for both this fiscal year and next. If you like earnings momentum, VLO has it.
I'd like to add a refiner to my portfolio, and am trying to decide between the two. Jim Cramer doesn't like VLO, but it did go up 50% or so vs 38% for PSX. However, i don't know which has the better fundamentals, such as better management, etc. Or should I go with another refiner? I'd appreciate any advice, thanks :)
