Phillips 66 vs Valero

This page offers a comprehensive comparison between Phillips 66 and Valero Energy Corp. We delve into their respective business models, analyse their financial performance, and examine their market context to provide insights for interested parties. Educational content, not financial advice.

This page offers a comprehensive comparison between Phillips 66 and Valero Energy Corp. We delve into their respective business models, analyse their financial performance, and examine their market co...

Comparison Snapshot

Key Financial Metrics

PSX

Metric

VLO

$56.57B

Market Cap

$55.90B

6.10%

Potential Profit

2.31%

Buy

Analyst Rating

Buy

Why It's Moving

Phillips 66 Fuels Momentum with 2026 Capital Plans and Analyst Upgrades

Announced $2.4B 2026 capital budget, with $1.1B for sustaining operations and the rest fueling expansions like the Western Gateway Pipeline with Kinder Morgan.
Goldman Sachs hiked price target to $164 from $152, while Wolfe Research lifted theirs to $160, backing an 'outperform' outlook on strong refining margins.
Recent insider sales noted, but broader sector gains and a consensus 'Moderate Buy' rating underscore PSX's appeal in volatile energy markets.

Sentiment:

🐃Bullish

Valero boosts dividend amid soft crude prices and sustainable fuel push, signaling strong cash flow confidence.

Dividend increase from $1.13 to $1.20 per share reflects steady cash flows, with payment set for March 9 to shareholders of record February 5.
Secured Venezuelan crude cargo under U.S. deal, providing cheaper feedstock to boost Gulf Coast refinery margins amid WTI prices below $60.
Ongoing investments in SAF production and FCC optimizations, plus planned Benicia refinery idling, sharpen focus on high-margin assets.

Sentiment:

🐃Bullish

Phillips 66 Fuels Momentum with 2026 Capital Plans and Analyst Upgrades

Announced $2.4B 2026 capital budget, with $1.1B for sustaining operations and the rest fueling expansions like the Western Gateway Pipeline with Kinder Morgan.
Goldman Sachs hiked price target to $164 from $152, while Wolfe Research lifted theirs to $160, backing an 'outperform' outlook on strong refining margins.
Recent insider sales noted, but broader sector gains and a consensus 'Moderate Buy' rating underscore PSX's appeal in volatile energy markets.

Sentiment:

🐃Bullish

Valero boosts dividend amid soft crude prices and sustainable fuel push, signaling strong cash flow confidence.

Dividend increase from $1.13 to $1.20 per share reflects steady cash flows, with payment set for March 9 to shareholders of record February 5.
Secured Venezuelan crude cargo under U.S. deal, providing cheaper feedstock to boost Gulf Coast refinery margins amid WTI prices below $60.
Ongoing investments in SAF production and FCC optimizations, plus planned Benicia refinery idling, sharpen focus on high-margin assets.

Sentiment:

🐃Bullish

Investment Analysis

Phillips 66

PSX

Pros

Diversification into midstream pipelines, terminals and chemical manufacturing reduces reliance on refining volatility.
Superior revenue growth of 32% since 2021 outpaces Valero's 27%.
Strategic exits from West Coast refining enhance operational efficiency.

Considerations

Higher trailing earnings multiple of 25 compared to Valero's 14 signals relative overvaluation.
Weaker dividend yield provides less immediate income appeal than Valero.
Lower 12-month stock return of 20% trails Valero's 44% performance.

Valero

VLO

Pros

Lower trailing earnings multiple of 14 offers attractive valuation versus Phillips 66.
Stronger 12-month stock return of 44% significantly outperforms Phillips 66.
Slight dividend advantage supports shareholder returns over Phillips 66.

Considerations

Pure refining focus heightens exposure to sector cyclicality and crude price swings.
Slower revenue growth of 27% since 2021 lags Phillips 66's 32%.
High gasoline inventories delay potential industry rebound benefits.

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