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Phillips 66 (PSX) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research
·3 min read

Phillips 66 (PSX) closed the most recent trading day at $82.83, moving -0.73% from the previous trading session. This change lagged the S&P 500's daily gain of 0.28%. At the same time, the Dow added 0.29%, and the tech-heavy Nasdaq gained 0.16%.

Heading into today, shares of the oil refiner had gained 16.05% over the past month, outpacing the Oils-Energy sector's gain of 9% and the S&P 500's loss of 5.39% in that time.

Phillips 66 will be looking to display strength as it nears its next earnings release, which is expected to be January 28, 2022. The company is expected to report EPS of $1.91, up 264.66% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $22.49 billion, up 34.11% from the prior-year quarter.

It is also important to note the recent changes to analyst estimates for Phillips 66. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

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Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 5.44% higher within the past month. Phillips 66 is holding a Zacks Rank of #2 (Buy) right now.

Digging into valuation, Phillips 66 currently has a Forward P/E ratio of 11.24. For comparison, its industry has an average Forward P/E of 17.06, which means Phillips 66 is trading at a discount to the group.

Investors should also note that PSX has a PEG ratio of 0.58 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Refining and Marketing industry currently had an average PEG ratio of 0.6 as of yesterday's close.

The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 93, which puts it in the top 37% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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