We recently published a list of 12 Best Energy Stocks to Invest in According to Billionaires. In this article, we are going to take a look at where Valero Energy Corporation (NYSE:VLO) stands against other best energy stocks to invest in according to billionaires.
After significantly lagging behind in 2024, the broader energy sector finally seems to be doing better now with gains of 6.21% since the beginning of 2025, against a decline of 3.42% by the wider market during the period.
The ongoing artificial intelligence boom is a significant growth driver for the energy industry, as its accompanying data centers consume 10 to 50 times the amount of energy per square foot of a typical commercial office building. According to the Department of Energy, the energy use by America’s data centers could reach between 74 and 132 gigawatts by 2028, or 6.7% to 12% of the total electricity consumption in the country. A large number of power companies are already ramping up their capacity to meet this growing power demand. It is forecasted that US electricity demand will grow 55% over the next 20 years, six times faster than the 9% growth witnessed over the past two decades.
According to energy data provider Enverus, a total of 80 new gas power plants could be constructed in America by the end of the decade to meet this growing demand. However, the price of natural gas has surged by over 140% over the last year and the costs for gas power plants have also soared in the last 18 months. If the US concentrates only on gas, it will become even more expensive, forcing up bills for consumers and businesses.
Nuclear energy has also received a massive boost in recent years, largely driven by its widespread recognition of its role in the global ‘clean energy transition’. The International Energy Agency recently revealed that nuclear is set to generate a record level of electricity this year. There are more than 70 gigawatts of new nuclear capacity under construction around the world, one of the highest levels in the last 30 years. Moreover, on the sidelines of the CERAWeek conference earlier this month, several major corporations have signed a pledge to support the goal of at least tripling the world’s nuclear energy capacity by 2050.
Despite the best efforts by the incumbent Trump administration to hamper its progress, the clean-energy industry is on pace for record growth this year. According to the US Energy Information Administration, the share of new power capacity that is expected to come online this year from renewables and batteries will jump to 93%.
The promising future prospects of the energy industry can also be reaffirmed by the growing interest of billionaire investors, who have significantly raised their stakes in the sector. Even Warren Buffett’s Berkshire Hathaway acquired an additional 763,017 shares of an oil and gas giant in Q4 2024, despite the ongoing issues faced by the industry. But while Buffett’s portfolio leans heavily on oil and gas, Berkshire Hathaway Energy operates one of the largest renewable energy portfolios in the US and has invested over $40 billion in wind, solar, and hydroelectric projects.
With that said, here are the Billionaires’ Favorite Energy Stocks to Buy Now.
12 Best Energy Stocks to Invest in According to Billionaires
Massive storage tanks filled with crude oil and diesel fuels at an oil refinery.
Methodology:
To collect data for this article, we scanned Insider Monkey’s database of billionaires’ stock holdings and picked the top 12 companies operating in the energy sector with the highest number of billionaire investors in Q4 of 2024. When two or more companies had the same number of billionaires backing them, we ranked them by the revenue of their last financial year. Following are the Best Energy Stocks According to Billionaires.
At Insider Monkey we are obsessed with the stocks that hedge funds pile into. The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Valero Energy Corporation (NYSE:VLO) is the world’s largest independent petroleum refiner and a leading producer of low-carbon transportation fuels. Founded in 1980, the company has 15 refineries in the US, Canada, and the UK, with a total throughput capacity of approximately 3.2 million barrels per day.
Valero Energy Corporation (NYSE:VLO) reported better-than-expected results in Q4 2024, posting an adjusted EPS of $0.64, significantly above expectations of $0.06. Meanwhile, the quarterly revenue came in at $30.76 billion, beating estimates by over $733 million. However, both the revenue and net income witnessed a significant YoY decline, highlighting the ongoing challenges in the refining sector. This is reflected in the performance of Valero’s refining segment in the fourth quarter, which reported only $437 million of operating income compared to $1.6 billion for the Q4 of 2023. Despite the issues, VLO returned $4.3 billion to stockholders in 2024, consisting of $2.9 billion in stock buybacks and $1.4 billion in dividends. The company also increased its quarterly cash dividend by 6%, placing it among the 13 Best Natural Gas and Oil Dividend Stocks To Buy.
In a significant development, Valero Energy Corporation (NYSE:VLO) completed the Sustainable Aviation Fuel project at the DGD Port Arthur plant in the fourth quarter of 2024 and is now fully operational. Since 2009, the company has invested over $5.4 billion in its low-carbon businesses, making it the world’s largest producer of low-carbon transportation fuels.
Overall, VLO ranks 12th on our list of the best energy stocks to invest in according to billionaires. While we acknowledge the potential for VLO, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than VLO but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
