US Equities Analysis

PSX — Phillips 66

Research evidence pack

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2. Company Fundamentals

2.1 Competitiveness

Metric Value
Operating Margins 0.64%
Profit Margins 3.07%
Return on Equity 14.55%
Return on Assets 3.8%
Free Float 0.4B
Dividend Yield 2.96%
Short Int % Utilisation 2.24%

2.2 Growth

Metric Value
Revenue Growth 6.9%
Free Cash Flow -1.13B
EBITDA 13.63 (Ratio)
Enterprise Value 95.98B
EV/Revenue 0.71
EV/EBITDA 13.63

Revenue growth of 6.9% indicates steady, moderate expansion.

2.3 Management

Role Metric
Consensus Rating N/A

2.4 Return

Metric Value
Expected Return (Ann.)* 106.07%
Risk / Std Dev (Ann.)* 30.97%
1-Year Price Return* 95.47%

Latest Market Data (as of 2026-08-14, US Eastern time):

Metric Value
Last Price $233.61
52-Week Range $121.24 – $236.10
Observation Count 251 trading days

The return and risk statistics use daily adjusted closes from the retrieved one-year series and annualise daily moments using 252 trading days. The last price is the latest regular-market price reported for the stated date. Source: Yahoo Finance market data.

2.5 FCFF DCF Valuation

Valuation basis: This research model follows a five-year, unlevered FCFF DCF. It starts from reported annual operating inputs, forecasts revenue and operating cash conversion under an explicit mechanical policy, discounts FCFF at WACC, applies a Gordon-growth terminal value, and bridges enterprise value to an indicative common-equity value per share. It is an analytical estimate rather than a recommendation or personalised target price.

Step 1 — Forecast Operating Profit and NOPAT

Reported operating input Value
Revenue $132.38B
Prior annual revenue $143.15B
EBIT $6.51B
Tax rate 16.46%
NOPAT = EBIT × (1 − tax rate) $5.44B
Forecast start-growth basis -7.53%
Forecast policy latest reported annual revenue growth, bounded to -10.00% / 15.00%

Step 2 — Calculate FCFF

Current FCFF building block Value
NOPAT $5.44B
Add: depreciation & amortisation $3.25B
Less: capital expenditure -$2.23B
Less/(add): working-capital cash-flow movement -$1.18B
Current unlevered FCFF $5.27B

Explicit FCFF forecast

Forecast year Revenue growth NOPAT D&A Capex Change in NWC FCFF Present value
1 -7.53% $5.03B $3.01B -$2.06B -$1.09B $4.88B $4.70B
2 -5.02% $4.77B $2.86B -$2.18B -$1.04B $4.41B $3.94B
3 -2.51% $4.65B $2.78B -$2.35B -$1.01B $4.08B $3.38B
4 -0.01% $4.65B $2.78B -$2.57B -$1.01B $3.86B $2.97B
5 2.50% $4.77B $2.85B -$2.85B -$1.04B $3.73B $2.66B

Step 3 — Determine the Discount Rate (WACC)

WACC input Value
Risk-free rate 4.71%
Equity risk premium assumption 5.50%
Beta 0.69
Cost of equity 8.49%
Pre-tax cost of debt 5.46%
WACC 7.82%
WACC validation within standard range

Step 4 — Estimate Terminal Value

Terminal-value input Value
Perpetuity growth rate 2.50%
Terminal value $71.90B
Implied terminal EV / EBITDA 8.40x
Terminal value as % of enterprise value 73.67%

Step 5 — Discount Cash Flows to Enterprise Value

Enterprise-value component Value
Present value of explicit FCFF $17.64B
Present value of terminal value $49.34B
Indicated enterprise value $66.97B
Discounting convention mid-year for explicit FCFF; terminal value discounted at year-end five

Step 6 — Convert Enterprise Value to Equity Value

Equity bridge Value
Indicated enterprise value $66.97B
Less: gross interest-bearing debt $19.72B
Add: cash and equivalents $1.12B
Add: affiliate investments $0.00
Less: minority interests $1.15B
Indicated common equity value $47.22B

Step 7 — Calculate Indicative Value Per Share

Per-share output Value
Shares used 408,053,000.00
Share-count basis reported diluted weighted-average shares
Current market price $241.20
DCF indicative value per share $115.73
Indicative value vs. market price -52.02%

Model Integrity Checks

Check Result
Perpetuity growth is below the risk-free rate pass
Perpetuity growth is below WACC pass
WACC is within the configured operating-company range pass
Terminal-year FCFF is positive pass
Terminal capex converges to D&A pass
Terminal-value concentration within review band
Implied price differs from spot by more than 30% review required

2.6 Investor-Style Research Screen

Educational screen Result
Buffett-inspired cash-quality checks 3/4 evidenced checks
Lynch-inspired balance-and-growth checks 4/4 evidenced checks

Data lineage: Yahoo Finance public market and reported-statement data; retrieval timestamp: 2026-08-18 17:46:47.919903 UTC; latest reported fiscal period: 2025-12-31 00:00:00. Default assumptions: five-year forecast, mid-year discounting for explicit FCFF, a maximum 2.50% perpetuity-growth rate below both WACC and the risk-free rate, historical operating-ratio persistence, and capex convergence to D&A by year five. No sell-side consensus or management guidance is substituted for reported inputs. This is research and analysis only, not personalized financial advice.

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