Profitability analysis
Phillips 66’s total revenues and other income were $150 billion, $175.7 billion and $114.9 billion in 2023, 2022 and 2021, respectively.
Total revenues and other income in 2023 were down 14.6% year-on-year.
Total revenues and other income in 2022 were up 53% year-on-year.
Net income was $7.2 billion, $11.4 billion and $1.6 billion in 2023, 2022 and 2021, respectively.
The net profit margin was 4.8%, 6.5% and 14% in 2023, 2022 and 2021, respectively.
Total equity was $31.65 billion and $34.1 billion in 2023 and 2022, respectively.
Phillips 66‘s return on equity was 22.7% and 33.4% in 2023 and 2022, respectively.
Balance sheet analysis
Phillips 66’s total assets were $75.5 billion and $76.4 billion at December 31, 2023 and at December 31, 2022, respectively.
Investments and long-term receivables were $15.3 as of December 31, 2023, accounting for 20.3% of total assets.
Net properties, plant and equipment were $35.7 billion as of December 31, 2023, consisting of 47.3% of total assets.
Total current assets were $20 billion as of December 31, 2023, making up 26.5% of total assets.
Total current liabilities were $15.9 billion as of December 31, 2023.
The current ratio was 1.26 times for 2023.
Total liabilities was $43.9 billion at December 31, 2023.
The debt ratio was 58.8% for 2023.
Cash flow analysis
Net cash provided by operating activities was $7 billion, $10.8 billion and $6 billion in 2023, 2022 and 2021, respectively.
Capital expenditures and investment were $2.4 billion, $2.2 billion and $1.9 billion in 2023, 2022 and 2021, respectively.
Free cash flow was $4.6 billion, $8.6 billion and $4.1 billion in 2023, 2022 and 2021, respectively.
Not all free cash flow is returned to shareholders, and a large proportion of free cash flow need to repay debt.
We don’t think that the amount of repurchasing stock and dividends paid to shareholders will fool you.
Repurchases of common stock were $4 billion and $1.5 billion in 2023 and 2022, respectively.
Dividends paid on common stock were $1.89 billion,$1.8 billion and $1.6 billion in 2023, 2022 and 2021, respectively.
Phillips’s average return each year was about $3.6 billion in the past three years.
Conclusion
There is not problem that oil price would affect Phillips 66’s stock price.
Phillips 66’s stock price is $157.25 per share, which is equivalent to $66.81 billion in market capitalization.
We reckon that $45 billion is a reasonable valuation.
Disclaimer: The content is for reference only and does not constitute investment advice.
Introduction
Phillips 66, headquartered in Houston, Texas, was incorporated in Delaware in 2011 in connection with, and in anticipation of, a restructuring of ConocoPhillips that separated its downstream businesses into an independent, publicly traded company named Phillips 66. The two companies were separated by ConocoPhillips distributing to its stockholders all the shares of common stock of Phillips 66 after the market closed on April 30, 2012 (the separation). Phillips 66 stock trades on the New York Stock Exchange under the “PSX” stock symbol.
Our businesses are organized into four operating segments:
1)Midstream—Provides crude oil and refined petroleum product transportation, terminaling and processing services, as well as natural gas and natural gas liquids (NGL) transportation, storage, fractionation, gathering, processing and marketing services, mainly in the United States. This segment also includes our 16% investment in NOVONIX Limited (NOVONIX).
2)Chemicals—Consists of our 50% equity investment in Chevron Phillips Chemical Company LLC (CPChem), which manufactures and markets petrochemicals and plastics on a worldwide basis.
3)Refining—Refines crude oil and other feedstocks into petroleum products, such as gasoline, distillates and aviation fuels, as well as renewable fuels. This segment includes 12 refineries in the United States and Europe.
4)Marketing & Specialties—Purchases for resale and markets refined petroleum products and renewable fuels, mainly in the United States and Europe. In addition, this segment includes the manufacturing and marketing of base oils and lubricants.
