Valvoline (NYSE:VVV) Announces Earnings Results

Valvoline (NYSE:VVV) announced its quarterly earnings results on Wednesday. The basic materials company reported $0.57 earnings per share (EPS) for the quarter, beating the consensus estimate of $0.50 by $0.07, FiscalAI reports. The company had revenue of $544.60 million for the quarter, compared to analyst estimates of $543.21 million. Valvoline had a net margin of 5.17% and a return on equity of 65.12%. The firm’s revenue was up 24.1% on a year-over-year basis. During the same period in the previous year, the firm posted $0.47 EPS. Valvoline updated its FY 2026 guidance to 1.700-1.750 EPS.

Here are the key takeaways from Valvoline’s conference call:

• Strong third-quarter performance: System-wide sales rose 19% to more than $1 billion, same-store sales increased 8%, EBITDA grew 25% to $162 million, and EPS rose 21% to $0.57. EBITDA margin expanded 30 basis points to 29.8%, supported by transaction growth and SG&A leverage.
• Valvoline raised its full-year same-store sales outlook to 7.5%-8% and narrowed adjusted EBITDA guidance to $550 million-$560 million and EPS guidance to $1.70-$1.75. Year-to-date free cash flow increased approximately $93 million, leverage declined to 2.8x, and debt repricing is expected to reduce annual interest expense by about $1.8 million.
• Lubricant cost inflation is intensifying: Group III base-oil constraints tied to disruption in the Strait of Hormuz could push finished lubricant costs roughly 60% above March levels, or $5-$7 more per oil change. Management expects this pressure to drive roughly 300-400 basis points of EBITDA margin compression in the fourth quarter, with elevated costs potentially lasting at least four to six months after the strait fully reopens.
• Customer demand remained resilient, with transaction growth and no broad signs of trade-down or service deferral, although lower-income households showed more moderate growth in June and non-oil-change service penetration softened seasonally. Management is monitoring pricing elasticity while using consumer pricing and operational discipline to protect gross-profit dollars.
• Network expansion and the Breeze integration are progressing well: Valvoline added 47 net new stores in the quarter to reach 2,456 locations, while 12 Breeze stores have been converted and are performing slightly ahead of expectations. Management said the Breeze deal thesis, return expectations, and early cost synergies remain intact.

Valvoline Price Performance

NYSE VVV traded down $0.41 on Friday, hitting $35.22. The company had a trading volume of 693,533 shares, compared to its average volume of 2,088,337. The company’s fifty day moving average price is $38.07 and its 200-day moving average price is $35.79. Valvoline has a 12-month low of $28.50 and a 12-month high of $41.33. The company has a debt-to-equity ratio of 3.77, a current ratio of 0.70 and a quick ratio of 0.61. The company has a market capitalization of $4.49 billion, a PE ratio of 43.99 and a beta of 1.00.

Analysts Set New Price Targets

Several research analysts have commented on VVV shares. TD Cowen cut their target price on Valvoline from $47.00 to $45.00 and set a “buy” rating on the stock in a report on Thursday. Citigroup reaffirmed a “neutral” rating on shares of Valvoline in a report on Thursday, July 16th. Barclays raised their price target on Valvoline from $35.00 to $41.00 and gave the company an “equal weight” rating in a research report on Tuesday, July 21st. The Goldman Sachs Group reaffirmed a “buy” rating and set a $45.00 target price on shares of Valvoline in a research note on Thursday, May 7th. Finally, Roth Capital reaffirmed a “buy” rating and set a $46.00 price objective on shares of Valvoline in a research report on Friday, May 8th. One investment analyst has rated the stock with a Strong Buy rating, eleven have issued a Buy rating and four have issued a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and a consensus target price of $42.56.

Insider Activity

In other Valvoline news, insider Jonathan L. Caldwell sold 2,851 shares of the business’s stock in a transaction dated Thursday, June 25th. The shares were sold at an average price of $40.00, for a total value of $114,040.00. Following the transaction, the insider directly owned 20,918 shares in the company, valued at $836,720. The trade was a 11.99% decrease in their position. The transaction was disclosed in a document filed with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Richard Joseph Freeland purchased 3,100 shares of the business’s stock in a transaction dated Thursday, May 14th. The shares were purchased at an average price of $32.37 per share, with a total value of $100,347.00. Following the acquisition, the director directly owned 16,112 shares in the company, valued at approximately $521,545.44. The trade was a 23.82% increase in their ownership of the stock. The SEC filing for this purchase provides additional information. Insiders have bought a total of 14,100 shares of company stock valued at $450,877 in the last ninety days. 0.66% of the stock is currently owned by company insiders.

Institutional Trading of Valvoline

Hedge funds have recently modified their holdings of the stock. Boston Partners increased its holdings in Valvoline by 20.6% during the 4th quarter. Boston Partners now owns 6,679,911 shares of the basic materials company’s stock worth $194,449,000 after purchasing an additional 1,142,290 shares during the period. Wellington Management Group LLP raised its holdings in Valvoline by 11.2% in the fourth quarter. Wellington Management Group LLP now owns 6,067,541 shares of the basic materials company’s stock valued at $176,323,000 after acquiring an additional 610,014 shares in the last quarter. State Street Corp lifted its stake in Valvoline by 4.6% in the fourth quarter. State Street Corp now owns 4,204,277 shares of the basic materials company’s stock worth $122,176,000 after acquiring an additional 184,598 shares during the last quarter. Channing Capital Management LLC grew its holdings in Valvoline by 40.7% during the 4th quarter. Channing Capital Management LLC now owns 3,031,697 shares of the basic materials company’s stock worth $88,101,000 after acquiring an additional 877,286 shares in the last quarter. Finally, Sculptor Capital LP increased its position in shares of Valvoline by 47.5% in the 2nd quarter. Sculptor Capital LP now owns 3,000,000 shares of the basic materials company’s stock valued at $113,610,000 after purchasing an additional 966,500 shares during the last quarter. 96.13% of the stock is currently owned by institutional investors and hedge funds.

About Valvoline

Valvoline (NYSE: VVV) is a leading global producer and distributor of automotive and industrial lubricants. The company’s portfolio spans engine oils, gear oils, transmission fluids, greases, coolants and driveline products, all designed to help improve vehicle performance and longevity. Valvoline’s products are marketed under the Valvoline®, Valvoline NextGen® and Valvoline™ SynPower® brand names and are formulated to meet the stringent requirements of passenger cars, light trucks, heavy‐duty vehicles and off‐road applications.

In addition to its core lubricant business, Valvoline operates one of North America’s largest quick‐lubricant service networks through Valvoline Instant Oil Change℠ (VIOC).