XOM - Phillips 66: Turnaround Still Very Much A Work In Progress
2024-04-29 11:38:17 ET
Summary
- Phillips 66's Q1 earnings report was another in a long line of disappointing results, showing that the company's refining "turnaround" is still very much a work in progress.
- It always seems to be something with PSX's Refining Segment. Despite running at a 92% utilization rate in Q1, refining once again severely underperformed with poor market capture.
- However, this time there were rational and understandable reasons, and PSX appears well positioned heading into the summer driving season.
- On the Q1 conference call, management said the company was on track to achieve its target to increase the refining margin by $1/bbl.
- Earlier in April, PSX raised its quarterly dividend by 10%. The company also announced the planned divestiture of its Jet-branded retail stations in Germany and Austria.
After what was arguably an Elliot Management-fueled rally, Phillips 66 ( PSX ) shareholders got a big dose of reality Friday after Q1 earnings disappointed, and the stock closed down $5.83/share, or 3.7% (see graphic below). Once again, it was Refining Segment results that came in well below market expectations and shows that the company's "turnaround" is still very much a work in progress. However, there are reasons to be optimistic going forward. Today, I'll review the Q1 results and offer my expectations for the stock going forward....
Phillips 66: Turnaround Still Very Much A Work In Progress