Suvro Sarkar, an analyst from DBS, maintained the Hold rating on Phillips 66 (PSX – Research Report). The associated price target is $162.00.
Suvro Sarkar has given his Hold rating due to a combination of factors influencing Phillips 66’s current market position. The company is well-diversified across various business segments, which include refining, chemicals, and marketing, making it less volatile compared to its peers. Despite this, the significant exposure to the chemical business in the US and Europe, which accounts for a substantial portion of its EBITDA, remains a concern due to ongoing challenges in these regions.
Sarkar also notes that while there are positive developments such as the Rodeo Renewed project and potential improvements in chemical demand from China, these are balanced by risks including operational disruptions and regulatory changes. Additionally, although Phillips 66 offers attractive shareholder returns with a high dividend payout ratio and share repurchase programs, these factors are not enough to warrant a more optimistic rating at this time. Therefore, the Hold rating is maintained with a target price of $162, reflecting a cautious outlook given the current market conditions.
Sarkar covers the Energy sector, focusing on stocks such as Marathon Petroleum, Diamondback, and Chevron. According to TipRanks, Sarkar has an average return of 5.6% and a 63.44% success rate on recommended stocks.
In another report released on March 14, Barclays also maintained a Hold rating on the stock with a $135.00 price target.
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