Highlights

  • Phillips 66 shows 323.26% basic EPS growth, a P/E of 16.17 and PEG of -16.86.
  • Third quarter net income attributable to Phillips 66 was $5,616 million, against $133 million.
  • Phillips 66 repurchased $2.3 billion of common stock in the third quarter.
  • The Board approved a $10 billion share repurchase authorization increase on July 29, 2026.

Phillips 66 (NYSE:PSX) shares were trading at USD 272.20 on October 28, 2026, up 1.37%, alongside one-year basic EPS growth of 323.26%, a trailing twelve-month P/E of 16.17 and an expected-basis PEG of -16.86, the three figures behind its place among undervalued growth stocks. Alongside those figures, the integrated downstream energy provider acquired the Lindsey Oil Refinery assets on April 28, 2026, saw its Board approve a $10 billion increase to the share repurchase authorization on July 29, 2026, and reported third quarter 2026 net income attributable to Phillips 66 of $5,616 million.

Headquartered in Houston, Texas, and incorporated in Delaware, Phillips 66 describes itself as a leading integrated downstream energy provider. It operates through five segments: Midstream, which includes Transportation and natural gas liquids (NGL) businesses, Chemicals (its 50% equity investment in Chevron Phillips Chemical Company LLC), Refining, Marketing and Specialties, and Renewable Fuels. Total assets were $86.0 billion at September 30, 2026, and the company ceased fuel production at its Los Angeles Refinery in the fourth quarter of 2025.

Growth: Third Quarter Earnings, Refining Margins and Segment Results

Net income attributable to Phillips 66 was $5,616 million in the third quarter of 2026 against $133 million a year earlier, and $9,670 million for the nine months against $1,497 million. Third quarter basic earnings per share were $14.14 against $0.32, and diluted earnings per share were $14.08 against $0.32.

The company said the quarterly increase was primarily due to higher realized margins in Refining and a before-tax impairment of $948 million recorded in the third quarter of 2025 on its equity investment in WRB Refining LP. Sales and other operating revenues were $50,540 million against $34,515 million, which the company said increased 46%.

Income before income taxes was $6,031 million in Refining against a loss of $518 million, $702 million in Midstream against $697 million. The composite 3:2:1 market crack spread averaged $60.17 per barrel against $23.64.

Valuation: P/E of 16.17, PEG of -16.86 and Cash Generation

The P/E ratio of 16.17 is measured on trailing twelve-month earnings, and the PEG ratio of -16.86 on an expected basis. Total stockholders' equity was $34,331 million at September 30, 2026, against $29,093 million at December 31, 2025. Cash from operations was $7.3 billion in the third quarter and $12.3 billion for the nine months.

The company's target is to return more than 50% of net cash provided by operating activities, excluding working capital, to shareholders, and it returned $4.4 billion in the nine months. On the second quarter 2026 call, management said it expected to meet its debt commitment ahead of schedule and to increase share repurchases in the second half of the year.

Capital Returns, Debt and Liquidity

Phillips 66 repurchased $2.3 billion of common stock in the third quarter and, for the nine months, 14 million shares at an aggregate cost of approximately $3.0 billion. Aggregate authorizations since July 2012 total $35 billion, they do not expire, and $9,296 million remained available at the end of September. In October the Board declared a quarterly dividend of $1.33 per share, a $0.06 increase.

Cash and cash equivalents were $5.8 billion, with $6.4 billion of total committed capacity under credit facilities. Short-term debt was $1,045 million and long-term debt was $17,485 million. The company targets total debt of $17 billion by the end of 2027.

Disclosed Risks and Outlook

In the Propel Fuels trade secrets case, the court entered final judgment of $833 million on August 5, 2025, with 10% post-judgment interest accruing. The company denies wrongdoing, carries accrued amounts of $947 million and stated it may be exposed to losses in excess of the amount recorded.

On October 9, 2026, the Standing Rock Sioux Tribe filed suit challenging the expanded 1.1 million barrel per day capacity of the Dakota Access pipeline. Phillips 66 holds a 25% share, and the company stated that a cessation of operations may have a material adverse effect on its results and cash flows. Marketing and Specialties income before income taxes for the nine months was $667 million against $2,104 million, with the company citing lower marketing fuel margins and a $1 billion gain on the Coop sale in January 2025. The company noted that commodity price movements could materially affect future results.

On outlook, the company budgeted $2.4 billion for 2026 capital expenditures and investments. It made a final investment decision in the third quarter on the proposed 1,300-mile Western Gateway Pipeline system, in which it owns 49.9%. It expects 2027 capital expenditures and investments to exceed its prior target of approximately $2.5 billion, subject to finalizing the 2027 budget.