A month has gone by since the last earnings report for Phillips 66PSX . Shares have lost about 3.3% in that time frame, underperforming the market.
Will the recent negative trend continue leading up to the stock's next earnings release, or is it due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important catalysts.
Fourth-Quarter 2016 Results
Phillips 66 posted adjusted fourth-quarter 2016 earnings of $0.16 per share that missed the Zacks Consensus Estimate of $0.39 and also came in below the year-ago figure of $1.31. Lower refining margins due to reduced market crack spread resulted in the underperformance. The negatives were mitigated to some extent by improved midstream business.
Quarterly revenues of $23,668 million surpassed the Zacks Consensus Estimate of $21,614 million as well as the year-ago quarter figure of $22,029 million.
The segment posted quarterly loss of $1 million, substantially narrower than a loss of $77 million in the year-ago quarter.
The segment reported earnings of $136 million as against $212 million in the year-earlier quarter. Higher turnaround activity led to the decrease.
The segment incurred loss of $38 million, which compared unfavorably with earnings of $410 million in the prior-year quarter. Decreased realized margins owing to lower market crack spread resulted in the underperformance.
Marketing and Specialties (M&S)
This segment recorded earnings of $190 million compared with $231 million in the year-ago quarter.
In the reported quarter, Phillips 66 generated $667 million of cash from operations. It also returned capital worth $558 million to shareholders.
As of Dec 31, 2016, the company had cash and cash equivalents of $2.7 billion and debt of $10.1 billion. The company???s debt-to-capitalization ratio was 30%.
How Have Estimates Been Moving Since Then?
Following the release, investors have witnessed a downward trend in fresh estimates. There have been two revisions lower for the current quarter. In the past month, the consensus estimate has shifted 35.23% downward due to these changes.
Phillips 66 Price and Consensus
At this time, Phillips 66's stock has a nice Growth Score of 'B', though it is lagging a lot on the momentum front with an 'F'. However, the stock was allocated a grade of 'B' on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'B'. If you aren't focused on one strategy, this score is the one you should be interested in.
Zacks' style scores indicate that the company's stock is suitable for value and growth investors.
Estimates have been broadly trending downward for the stock. The magnitude of this revision also indicates a downward shift. Interestingly, the stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
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