Reconsidering Our Rating on Valero

Since we picked it, the stock's price has fallen on worsening sentiment and some downward adjustments to analysts' profit estimates. These events drove our model enough to move the stock down a peg from a B-minus buy to a C-plus hold, and we'll stick to our discipline by following the model's assessment.

We continue to advise holding shares previously purchased but would not recommend putting fresh money into the name. We'll monitor the situation for any improvement or further deterioration and alert readers if there is a change. But we are bound to follow our model's assessments, and we will do so here.

Using a quantitative model to pick stocks can seem strict at times, but doing so will save you more often than hurt you, in our experience. And so we've reached a crossroads with Valero. When we added this name to our running list of stock picks at the beginning of June, it was rated B-minus, and it was sitting at the cusp where buy meets hold in our rating system. We understood the risk we were taking picking a stock with this low-ish assessment, and this is what happens when the positive factors are overshadowed by negative ones.

Our next edition of RealMoney Stock Picks from TheStreet.com Ratings, along with a fresh list of our current assessment of the market, will be published as soon as possible after the July Fourth holiday weekend.

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This article was written by a staff member of TheStreet.com Ratings.