Phillips 66 (PSX) AI Stock Analysis

• Market Cap: $42.15B
• Dividend Yield: 4.42%
• Average Volume (3M): 3.37M
• Price to Earnings (P/E): 23.6
• Beta (1Y): 0.96
• Revenue Growth: -7.61%
• EPS Growth: -66.18%
• Country: US
• Employees: 13,200
• Sector: Energy
• Sector Strength: 47
• Industry: Oil & Gas Refining & Marketing
• EPS (TTM): 4.38
• Shares Outstanding: 407,437,260
• 10 Day Avg. Volume: 2,534,407
• 30 Day Avg. Volume: 3,374,052
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.64
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 6.38
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $130.31
• Price Target Upside: 25.95% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 17

Phillips 66 demonstrates robust cash flow and strategic growth initiatives, which are offset by challenges in profitability and market trends. The company benefits from strong shareholder returns and operational improvements, but faces pressure from a high P/E ratio and recent market performance. The earnings call provides a mixed outlook, with significant strategic steps forward but current financial challenges.

Positive Factors

Business Resilience

Phillips 66 is a fully integrated energy company with a well-diversified product portfolio, making its overall business less volatile and more resilient than its peers.

Operating Costs

PSX is one of the lowest operating cost refiners, thanks to its crude sourcing flexibility and higher refining utilization rate compared to US peers.

Renewable Fuels

The startup of the Rodeo Renewed project will convert the refinery into one of the world’s largest renewable fuels facilities, potentially boosting refinery performance and profitability.

Negative Factors

Chemical Business Challenges

High exposure to the chemical business in the US and EU, which remains challenged, has led to a HOLD rating recommendation.

Earnings Performance

Earnings disappointed with refining weak as anticipated on maintenance while RD and Marketing missed.

Operational Risks

Key risks for Phillips 66 include business and operational risks such as crude supply disruptions, energy price volatility, and weaker-than-expected chemical demand recovery.

Phillips 66 Business Overview & Revenue Model

Company Description

Phillips 66 operates as an energy manufacturing and logistics company. It operates through four segments: Midstream, Chemicals, Refining, and Marketing and Specialties (M&S). The Midstream segment transports crude oil and other feedstocks; delivers refined petroleum products to market; provides terminaling and storage services for crude oil and refined petroleum products; transports, stores, fractionates, exports, and markets natural gas liquids; provides other fee-based processing services; and gathers, processes, transports, and markets natural gas. The Chemicals segment produces and markets ethylene and other olefin products; aromatics and styrenics products, such as benzene, cyclohexane, styrene, and polystyrene; and various specialty chemical products, including organosulfur chemicals, solvents, catalysts, and chemicals used in drilling and mining. The Refining segment refines crude oil and other feedstocks into petroleum products, such as gasolines, distillates, aviation, and renewable fuels at 12 refineries in the United States and Europe. The M&S segment purchases for resale and markets refined petroleum products, including gasolines, distillates, and aviation fuels primarily in the United States and Europe. This segment also manufactures and markets specialty products, such as base oils and lubricants. The company was founded in 1875 and is headquartered in Houston, Texas.

How the Company Makes Money

Phillips 66 generates revenue through several key streams. The refining segment, which processes crude oil into gasoline and other fuels, accounts for a significant portion of its income. The midstream operations involve the transportation, storage, and processing of crude oil and natural gas liquids, providing stable fee-based revenue. The chemicals segment, operated through a joint venture with Chevron called Chevron Phillips Chemical Company, manufactures and sells petrochemicals and plastics. Additionally, the marketing and specialties division sells refined products at wholesale and retail levels, contributing to the company's earnings. Strategic partnerships, such as those in the chemicals sector, and a broad geographic presence also play vital roles in the company's profitability.

Phillips 66 Financial Statement Overview

Summary

Phillips 66 presents a stable financial profile with strong cash flow management and a balanced capital structure. However, profitability metrics such as net profit margin and ROE are areas of concern despite consistent revenue and gross profit figures.

Income Statement

Phillips 66 has shown a mixed performance with strong gross profit margins and positive revenue growth over the years. The TTM (Trailing-Twelve-Months) data indicates a gross profit margin of 27.44%, which is relatively healthy for the industry. However, the net profit margin for TTM stands at only 1.33%, indicating lower profitability. Revenue growth has been inconsistent, with slight declines in recent years, but overall stability has been maintained.

Balance Sheet

The company's balance sheet reflects moderate stability, with a debt-to-equity ratio of 0.69 in TTM, indicating a balanced use of debt and equity financing. The return on equity is relatively low at 6.81% for TTM, suggesting limited returns to shareholders. The equity ratio of 37.97% shows a decent level of equity financing in the asset structure.

Cash Flow

Phillips 66 demonstrates strong cash flow management with a significant operating cash flow to net income ratio of 2.49 in TTM, indicating efficient conversion of net income into cash flows. The free cash flow has grown by 45.02% from the previous year, reflecting improved cash generation capabilities. Despite negative investing cash flows, the company maintains a healthy cash flow position.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
143.15B	147.40B	169.99B	111.48B	64.13B
	Gross Profit
10.83B	11.15B	18.43B	7.77B	5.03B
	EBIT
1.75B	8.02B	12.74B	3.83B	-287.00M
	EBITDA
5.99B	12.37B	16.91B	3.95B	-3.05B
	Net Income Common Stockholders
2.12B	7.00B	11.02B	1.31B	-3.71B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
1.74B	3.32B	6.13B	3.15B	2.51B
	Total Assets
72.58B	75.50B	76.44B	55.59B	54.72B
	Total Debt
20.06B	19.36B	17.19B	14.45B	15.89B
	Net Debt
18.32B	16.04B	11.06B	11.30B	13.38B
	Total Liabilities
44.12B	43.85B	42.34B	33.96B	33.20B
	Stockholders Equity
27.41B	30.58B	29.49B	19.17B	18.98B
Cash Flow		Free Cash Flow
2.33B	4.61B	8.62B	4.16B	-809.00M
	Operating Cash Flow
4.19B	7.03B	10.81B	6.02B	2.11B
	Investing Cash Flow
-2.46B	-5.86B	-1.49B	-1.87B	-3.08B
	Financing Cash Flow
-3.31B	-4.03B	-6.39B	-3.47B	1.79B

Phillips 66 Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 103.46
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PSX, the sentiment is Negative. The current price of 103.46 is above the 20-day moving average (MA) of 100.57, below the 50-day MA of 115.64, and below the 200-day MA of 123.77, indicating a neutral trend. The MACD of -3.13 indicates Negative momentum. The RSI at 44.30 is Neutral, neither overbought nor oversold. The STOCH value of 82.61 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for PSX.

Phillips 66 Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
SUN	74 Outperform	$8.88B	9.69	28.38%	6.04%	-1.63%	80.11%
VLO	67 Neutral	$35.98B	40.50	3.73%	3.74%	-8.44%	-85.95%
MPC	67 Neutral	$42.90B	13.64	16.33%	2.52%	-6.70%	-57.85%
PSX	66 Neutral	$42.15B	23.60	6.48%	4.42%	-7.61%	-66.18%
DINO	65 Neutral	$5.89B	34.32	1.78%	6.65%	-10.58%	-90.08%
Sector *	56 Neutral	$6.92B	3.31	-4.49%	6.03%	-0.35%	-47.83%
PBF	52 Neutral	$1.99B	―	-8.87%	6.11%	-13.59%	-127.47%

Phillips 66 Corporate Events

Phillips 66 Completes $2.2 Billion Acquisition of EPIC Y-Grade

On April 1, 2025, Phillips 66 completed the acquisition of EPIC Y-Grade GP, LLC and EPIC Y-Grade, LP for approximately $2.2 billion, enhancing its position as a leading integrated downstream energy provider. This acquisition, which includes natural gas liquids pipelines and fractionation facilities, strengthens Phillips 66’s ability to deliver energy products efficiently and is expected to create long-term value for shareholders. The expansion of the NGL pipeline capacity is planned to be completed by the fourth quarter of 2026, further integrating Permian production with Gulf Coast markets.

Phillips 66 Announces Board Member Departures in 2025

On February 12, 2025, Phillips 66 announced that board members Gary K. Adams and Denise L. Ramos decided not to stand for reelection at the company’s 2025 Annual Meeting of Shareholders, as part of the board’s ongoing refreshment activities. Their departure will result in the reduction of the board size from 14 to 12 directors, effective immediately after the Annual Meeting, indicating a strategic shift but not due to any disagreements with company policies.