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Phillips 66 (PSX) Gears Up for Q4 Earnings: What's in Store?

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Phillips 66 (PSX - Free Report) is set to report fourth-quarter 2023 earnings on Jan 31, before the opening bell.

In the last reported quarter, the company’s earnings of $4.63 per share missed the Zacks Consensus Estimate of $4.78 due to declining refining margins worldwide. PSX’s earnings beat the Zacks Consensus Estimate in two of the trailing four quarters and missed the same twice, delivering an average surprise of 3.9%. This is depicted in the graph below.

Phillips 66 Price and EPS Surprise

Phillips 66 Price and EPS Surprise

Phillips 66 price-eps-surprise | Phillips 66 Quote

Estimate Trend

The Zacks Consensus Estimate for fourth-quarter earnings per share of $2.41 has witnessed two upward and four downward revisions over the past 60 days. The estimated figure suggests a significant decline from the year-ago quarter’s reported number.

The Zacks Consensus Estimate for fourth-quarter revenues of $34.3 billion indicates a 16.1% decline from the year-ago reported figure.

Factors to Consider

Phillips 66 is likely to have generated stable earnings from its midstream business since the pipeline and storage assets are highly integrated with its refining, marketing and specialties, and chemical segments.

However, a significantly high oil price and lower retail gasoline price in the fourth quarter are likely to have hurt the company’s refining operations. We expect adjusted pre-tax earnings from refining to decline almost 40% year over year.

Earnings Whispers

Our proven model does not indicate an earnings beat for PSX this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you will see below.

Earnings ESP: Phillips 66’s Earnings ESP is 0.00%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: The company currently carries a Zacks Rank #3.

Stocks to Consider

Here are two firms that you may want to consider, as these have the right combination of elements to post an earnings beat this reporting cycle.

Western Midstream Partners, LP (WES - Free Report) currently has an Earnings ESP of +10.54% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

The partnership is scheduled to release fourth-quarter earnings on Feb 21. The Zacks Consensus Estimate for WES’s earnings is pegged at 78 cents per share, indicating a decline from the year-ago quarter’s recorded figure.

Exxon Mobil Corporation (XOM - Free Report) currently has an Earnings ESP of +0.49% and a Zacks Rank #3.

ExxonMobil is scheduled to release fourth-quarter earnings on Feb 2. The Zacks Consensus Estimate for XOM’s earnings is pegged at $2.22 per share.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.


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