Phillips 66 Earnings: Tops Wall Street Profit Estimate

Phillips 66 (NYSE:PSX) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. Shares are up 2.87%.

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Earnings Cheat Sheet

Results: Net income decreased -34.86% to $1.31 billion ($2.06 per diluted share) in the quarter versus a net gain of $2.01 billion in the year-earlier quarter.

Revenue: Decreased 11.45% to $44.67 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: reported adjusted net income of $2.06 per share. By that measure, the company beat the mean analyst estimate of $1.68. It missed the average revenue estimate of $46.03 billion.

Quoting Management:

“Strong realized refining and chemicals margins improved our earnings during the quarter,” said Greg Garland, Phillips 66 chairman and chief executive officer. “Our $1 billion debt reduction strengthens our financial flexibility and resulted in a 25 percent debt-to-capital ratio at the end of the year. We were pleased to return more than $400 million in capital to shareholders in the quarter while also funding new investments including the Sand Hills and Southern Hills pipeline projects. We also announced our intent to contribute a portion of our transportation assets to form a master limited partnership, which we expect will highlight the value of our logistics and infrastructure assets, and serve as an efficient vehicle for funding growth investments…

…The company’s solid financial performance in 2012 was underpinned by safe, reliable and efficient operations. Our differentiated portfolio allowed us to capture a number of market opportunities across the value chain resulting in significant cash generation and shareholder value creation,” Garland added.

Key Stats:

Revenue increased 1.74% from $43.91 billion in the previous quarter. Net income decreased 18.07% from $1.6 billion in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $1.2 to a profit $1.44. For the current year, the average estimate has moved up from a profit of $7.12 to a profit of $7.95 over the last ninety days.

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(Company fundamentals provided by Xignite Financials.)