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Why Phillips 66 (PSX) Dipped More Than Broader Market Today

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The most recent trading session ended with Phillips 66 (PSX - Free Report) standing at $129.83, reflecting a -0.59% shift from the previouse trading day's closing. This change lagged the S&P 500's 0.19% loss on the day. Elsewhere, the Dow lost 0.55%, while the tech-heavy Nasdaq lost 0.18%.

The oil refiner's stock has climbed by 2.11% in the past month, falling short of the Oils-Energy sector's gain of 3.07% and the S&P 500's gain of 6.66%.

Market participants will be closely following the financial results of Phillips 66 in its upcoming release. The company's earnings per share (EPS) are projected to be $1.10, reflecting a 64.4% decrease from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $32.39 billion, down 16.39% from the year-ago period.

PSX's full-year Zacks Consensus Estimates are calling for earnings of $7.59 per share and revenue of $143.9 billion. These results would represent year-over-year changes of -51.99% and -4%, respectively.

Investors should also take note of any recent adjustments to analyst estimates for Phillips 66. Such recent modifications usually signify the changing landscape of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 1.08% decrease. Phillips 66 is holding a Zacks Rank of #3 (Hold) right now.

With respect to valuation, Phillips 66 is currently being traded at a Forward P/E ratio of 17.2. Its industry sports an average Forward P/E of 15.94, so one might conclude that Phillips 66 is trading at a premium comparatively.

Meanwhile, PSX's PEG ratio is currently 4.3. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. Oil and Gas - Refining and Marketing stocks are, on average, holding a PEG ratio of 2.5 based on yesterday's closing prices.

The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. Currently, this industry holds a Zacks Industry Rank of 204, positioning it in the bottom 19% of all 250+ industries.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the 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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