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Phillips 66 (PSX) Surpasses Market Returns: Some Facts Worth Knowing

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Phillips 66 (PSX - Free Report) closed at $149.21 in the latest trading session, marking a +1.66% move from the prior day. This move outpaced the S&P 500's daily gain of 1.03%. Meanwhile, the Dow experienced a rise of 0.34%, and the technology-dominated Nasdaq saw an increase of 1.51%.

Shares of the oil refiner witnessed a gain of 0.16% over the previous month, trailing the performance of the Oils-Energy sector with its gain of 4.1% and the S&P 500's gain of 3.21%.

The upcoming earnings release of Phillips 66 will be of great interest to investors. In that report, analysts expect Phillips 66 to post earnings of $2.58 per share. This would mark a year-over-year decline of 38.72%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $31.71 billion, down 9.64% from the year-ago period.

For the entire fiscal year, the Zacks Consensus Estimates are projecting earnings of $13.06 per share and a revenue of $133.96 billion, representing changes of -17.39% and -10.63%, respectively, from the prior year.

Any recent changes to analyst estimates for Phillips 66 should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To utilize this, we have created the Zacks Rank, a proprietary model that integrates these estimate changes and provides a functional rating system.

The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.21% higher. Phillips 66 currently has a Zacks Rank of #3 (Hold).

Looking at valuation, Phillips 66 is presently trading at a Forward P/E ratio of 11.24. This denotes a discount relative to the industry's average Forward P/E of 11.71.

It's also important to note that PSX currently trades at a PEG ratio of 1.87. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. As the market closed yesterday, the Oil and Gas - Refining and Marketing industry was having an average PEG ratio of 1.73.

The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. Currently, this industry holds a Zacks Industry Rank of 149, positioning it in the bottom 41% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.


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