Form 4: Valero EVP & COO Reports Stock Award, Tax-Related Sale

Valero Energy's EVP & COO, Gary K. Simmons, reported the acquisition of restricted common stock and performance shares, alongside a disposition of shares for tax obligations.

Summary

• Gary K. Simmons, Executive Vice President & Chief Operating Officer of Valero Energy Corp (VLO), reported transactions on February 25, 2026.
• Simmons acquired 13,320 shares of common stock as an award of restricted common stock, subject to time vesting, at a price of $0.
• Following this acquisition, Simmons' direct beneficial ownership of common stock increased to 239,609 shares.
• Simmons disposed of 5,242 shares of common stock at a price of $198.025 per share, primarily for the payment of tax liability incident to the vesting of a security.
• After the disposition, Simmons' direct beneficial ownership of common stock was 234,367 shares.
• Simmons also acquired 13,320 performance shares at a price of $0, which will vest annually in one-third increments beginning in 2027.
• These performance shares are payable in common stock, with amounts ranging from zero to 200 percent of the performance shares, based on a Performance Share Agreement.
• The reported direct beneficial ownership of 234,367 shares does not include an additional 13,122.018 shares indirectly held by Simmons in a thrift plan.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this filing as neutral. It reports routine executive compensation transactions, including stock awards and tax-related dispositions, which do not provide new insights into the company's operational or financial performance.

Positives

• Gary K. Simmons received an award of 13,320 restricted common shares, indicating ongoing executive compensation and alignment with shareholder interests.
• An additional 13,320 performance shares were awarded, providing potential for future equity ownership based on company performance.

Negatives

• A disposition of 5,242 shares of common stock occurred at a price of $198.025, primarily to cover tax liabilities associated with the vesting of equity awards, resulting in a reduction of direct beneficial ownership.

Future Outlook

Performance shares awarded to Gary K. Simmons are scheduled to begin vesting annually in one-third increments starting in 2027, with payouts in common stock ranging from zero to 200 percent based on performance criteria.

Industry Context

StockSavvy.ai notes that executive compensation, particularly through equity awards like restricted stock and performance shares, is a standard practice across the energy sector. These awards are designed to align executive incentives with long-term company performance and shareholder value creation. The tax-related disposition of shares is a routine event associated with the vesting of such awards.

Comparison to Industry Standards

• The structure of executive compensation, including restricted stock and performance share awards with vesting schedules, is consistent with common practices observed in major integrated energy companies such as ExxonMobil (XOM), Chevron (CVX), and Marathon Petroleum (MPC).
• The disposition of shares to cover tax obligations upon vesting is a standard and expected occurrence for executives receiving equity compensation across all industries, not unique to Valero or the energy sector.

Stakeholder Impact

• Shareholders: The award of equity to an executive aligns management's interests with shareholder value over the long term. The tax-related sale is a routine event and does not reflect a change in management's confidence in the company.

Next Steps

• Performance shares will begin vesting in one-third increments annually starting in 2027.

Key Dates

Recommendation

This Form 4 filing details routine executive compensation transactions, specifically the award of restricted stock and performance shares, and a disposition of shares for tax purposes. It does not contain any new information regarding Valero Energy's operational performance, financial outlook, or strategic direction that would warrant a change in investment recommendation. Therefore, a 'hold' recommendation is appropriate as this filing does not alter the fundamental investment thesis for VLO.

Keywords

Valero Energy, VLO, Gary K. Simmons, EVP & COO, Restricted Stock, Performance Shares, Insider Trading, Executive Compensation, Form 4, Stock Award, Tax Withholding