- Phillips 66's (PSX +0.2%) diversification will drive growth and value creation going forward, Oppenheimer Fadel Gheit says as he reiterates an Outperform rating and $95 price target on the stock.
- Gheit writes that while his targets are above consensus, he thinks PSX’s mix of assets, execution, shareholder friendliness and growth outlook all warrant a premium valuation.
- Gheit sees PSX's operating cash flow at $4.8B this year and $4.1B next year, which, combined with cash and some additional borrowing, can cover capex plans of $4.6B and $3.5B, respectively, a $1.2B annual dividend and ~$50M in Philips 66 Partners (NYSE:PSXP) distributions.