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Phillips 66 (PSX - Free Report) reported second-quarter 2024 adjusted earnings of $2.31 per share, which beat the Zacks Consensus Estimate of $2.12. However, the bottom line was lower than the year-ago quarter’s level of $3.87.
Total quarterly revenues of $38.9 billion beat the Zacks Consensus Estimate of $32 billion. The top line also improved from the year-ago quarter’s $35.7 billion.
The better-than-expected quarterly results can be primarily attributed to record natural gas liquids (NGL) volumes in the Midstream segment and refining crude utilization hitting a five-year high. This was partially offset by higher total costs and expenses.
The segment generated adjusted pre-tax quarterly earnings of $753 million, up from $642 million in the year-ago quarter. The reported figure also surpassed our estimate of $604.6 million. The increase can be attributed to higher NGL volumes and margins, as well as lower costs.
Chemicals:
The unit recorded adjusted pre-tax earnings of $222 million, up from $192 million in the prior-year quarter. The reported figure also surpassed our estimate of $155.5 million. The rise in profits can be primarily attributed to increased margins, partially offset by turnaround costs.
Refining:
The segment reported adjusted pre-tax earnings of $302 million, down from $1.19 billion in the year-ago quarter. The reported figure also missed our projection of $744.1 million. The decrease was primarily due to lower market crack spreads, partially offset by higher volumes and lower costs.
Refining’s realized refining margins worldwide declined to $10.01 per barrel from the year-ago quarter’s $15.55, and the same in the Central Corridor and Atlantic Basin/Europe declined to $12.75 and $8.10 per barrel, respectively, from the year-ago quarter’s $22.58 and $10.64.
The West Coast’s margins declined to $13.06 per barrel from $15.80 in the year-ago quarter. In the Gulf Coast, the metric declined to $7.88 per barrel from $13.22 a year ago.
Marketing & Specialties
Pre-tax earnings declined to $415 million from $533 million in the year-ago quarter. The reported figure lagged our projection of $492.1 million.
Realized marketing fuel margins in the United States declined to $1.70 per barrel from the year-ago quarter’s $2.25, and the same in the international markets decreased to $5.87 from $6.50 a year ago.
Costs & Expenses
Total costs and expenses in the second quarter increased to $37.6 billion from $33.5 billion in the year-ago period. Our projection for the same was pinned at $30 billion.
Financial Condition
For the reported quarter, Phillips 66 generated $2.1 billion of net cash from operations, significantly higher than $955 million a year ago. The company’s capital expenditure and investments totaled $367 million. It paid out dividends of $485 million in the second quarter.
As of Jun 30, 2024, cash and cash equivalents were $2.4 billion. Total debt was $19.9 billion, reflecting a debt-to-capitalization of 43.4%.
Zacks Rank & Stocks to Consider
Phillips 66 currently carries a Zacks Rank #5 (Strong Sell).
Sunoco is a leading wholesale motor fuel distributor in the United States, boasting a vast distribution network spanning 40 states. With long-term contracts servicing more than 10,000 convenience stores, it distributes over 10 fuel brands, ensuring a stable revenue stream. SUN currently has a Value Score of A.
The Zacks Consensus Estimate for 2024 and 2025 earnings per unit is pegged at $7.29 and $7.26, respectively. The partnership has witnessed upward earnings estimate revisions for 2025 in the past 30 days.
SM Energy is set to expand its oil-centered operations in the coming years, with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.09. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Hess is a leading oil and natural gas exploration and production company that made several world-class oil discoveries in the Stabroek Block, located off the coast of Guyana. The company is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. The merger will likely result in the creation of an energy behemoth with a massive portfolio of producing assets.
The Zacks Consensus Estimate for HES’ 2024 EPS is pegged at $11.08. The company has a Zacks Style Score of A for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.
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Phillips 66 (PSX) Q2 Earnings Beat, Revenues Increase Y/Y
Phillips 66 (PSX - Free Report) reported second-quarter 2024 adjusted earnings of $2.31 per share, which beat the Zacks Consensus Estimate of $2.12. However, the bottom line was lower than the year-ago quarter’s level of $3.87.
Total quarterly revenues of $38.9 billion beat the Zacks Consensus Estimate of $32 billion. The top line also improved from the year-ago quarter’s $35.7 billion.
The better-than-expected quarterly results can be primarily attributed to record natural gas liquids (NGL) volumes in the Midstream segment and refining crude utilization hitting a five-year high. This was partially offset by higher total costs and expenses.
Phillips 66 Price, Consensus and EPS Surprise
Phillips 66 price-consensus-eps-surprise-chart | Phillips 66 Quote
Segmental Results
Midstream:
The segment generated adjusted pre-tax quarterly earnings of $753 million, up from $642 million in the year-ago quarter. The reported figure also surpassed our estimate of $604.6 million. The increase can be attributed to higher NGL volumes and margins, as well as lower costs.
Chemicals:
The unit recorded adjusted pre-tax earnings of $222 million, up from $192 million in the prior-year quarter. The reported figure also surpassed our estimate of $155.5 million. The rise in profits can be primarily attributed to increased margins, partially offset by turnaround costs.
Refining:
The segment reported adjusted pre-tax earnings of $302 million, down from $1.19 billion in the year-ago quarter. The reported figure also missed our projection of $744.1 million. The decrease was primarily due to lower market crack spreads, partially offset by higher volumes and lower costs.
Refining’s realized refining margins worldwide declined to $10.01 per barrel from the year-ago quarter’s $15.55, and the same in the Central Corridor and Atlantic Basin/Europe declined to $12.75 and $8.10 per barrel, respectively, from the year-ago quarter’s $22.58 and $10.64.
The West Coast’s margins declined to $13.06 per barrel from $15.80 in the year-ago quarter. In the Gulf Coast, the metric declined to $7.88 per barrel from $13.22 a year ago.
Marketing & Specialties
Pre-tax earnings declined to $415 million from $533 million in the year-ago quarter. The reported figure lagged our projection of $492.1 million.
Realized marketing fuel margins in the United States declined to $1.70 per barrel from the year-ago quarter’s $2.25, and the same in the international markets decreased to $5.87 from $6.50 a year ago.
Costs & Expenses
Total costs and expenses in the second quarter increased to $37.6 billion from $33.5 billion in the year-ago period. Our projection for the same was pinned at $30 billion.
Financial Condition
For the reported quarter, Phillips 66 generated $2.1 billion of net cash from operations, significantly higher than $955 million a year ago. The company’s capital expenditure and investments totaled $367 million. It paid out dividends of $485 million in the second quarter.
As of Jun 30, 2024, cash and cash equivalents were $2.4 billion. Total debt was $19.9 billion, reflecting a debt-to-capitalization of 43.4%.
Zacks Rank & Stocks to Consider
Phillips 66 currently carries a Zacks Rank #5 (Strong Sell).
Investors interested in the energy sector may look at some better-ranked stocks like Sunoco LP (SUN - Free Report) , SM Energy Company (SM - Free Report) and Hess Corporation (HES - Free Report) . While Sunoco and SM Energy currently sport a Zacks Rank #1 (Strong Buy) each, Hess carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Sunoco is a leading wholesale motor fuel distributor in the United States, boasting a vast distribution network spanning 40 states. With long-term contracts servicing more than 10,000 convenience stores, it distributes over 10 fuel brands, ensuring a stable revenue stream. SUN currently has a Value Score of A.
The Zacks Consensus Estimate for 2024 and 2025 earnings per unit is pegged at $7.29 and $7.26, respectively. The partnership has witnessed upward earnings estimate revisions for 2025 in the past 30 days.
SM Energy is set to expand its oil-centered operations in the coming years, with an increasing focus on crude oil, especially in the Permian Basin and Eagle Ford regions. The company’s attractive oil and gas investments should create long-term value for shareholders.
The Zacks Consensus Estimate for SM’s 2024 EPS is pegged at $7.09. The company has a Zacks Style Score of A for Value. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
Hess is a leading oil and natural gas exploration and production company that made several world-class oil discoveries in the Stabroek Block, located off the coast of Guyana. The company is currently in the process of being acquired by supermajor Chevron in an all-stock deal worth $53 billion. The merger will likely result in the creation of an energy behemoth with a massive portfolio of producing assets.
The Zacks Consensus Estimate for HES’ 2024 EPS is pegged at $11.08. The company has a Zacks Style Score of A for Growth. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past seven days.