Deutsche Bank Starts Phillips 66 (PSX) at Hold; Premier Refiner, But Mega-Shift Underway

May 1, 2012 10:06 AM EDT
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Price: $80.63 +0.74%

Rating Summary:
    10 Buy, 8 Hold, 1 Sell

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Deutsche Bank initiates coverage on Phillips 66 (NYSE: PSX) with a Hold. PT $37.00.

Deutsche analyst said, "To anybody who is still unaware of the mega-shifts underway in US oil markets, witness the acquisition of century-old Sunoco by a natural gas pipeline company, the day before an Oklahoma refining name starts trading as a standalone company using an 85 year old brand. Although we see this as a premium refiner to direct comp Valero (NYSE: VLO), with NGL gathering & chemicals growth and an MLP kicker, we have a cautious 12 month view on refining, and with valuation on the When-Issued stock looking generous at 4.5x 2013e EBITDA vs the independent refining group at 3.8x, 8.2x P/E vs group at 7.9x P/E, we struggle to find 20%+ upside, and initiate with a Hold."

For an analyst ratings summary and ratings history on Phillips 66 click here. For more ratings news on Phillips 66 click here.

Shares of Phillips 66 closed at $34.05 yesterday.

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