An analyst somewhere says that Phillips 66 is in the wrong peer group. The analyst says that because of Midstream and Chemicals our peers should be Exxon, Chevron and other similarly integrated energy companies. If we did that we’d be outperforming almost everyone.
If we do that why not just say that VLO and MPC are not our peers anymore. Just the smaller refiners.
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@pf
Forgive my ignorance, but MPC consolidates MPLX on their financials, so why would they be insulated from Midtream effects?
Do you mean that investors focus more on MPC standalone (with MPLX removed), than they do on the consolidated view?
Is that how PSX was viewed by investors when we had PSXP?
Marathon has a similar portfolio, but their stock is insulated from midstream effects since their midstream is bundled up in MPLX. I guess we could spin up PSXP again if we really wanted to and have similar performance...
MPC is the most directly comparable peer and the PSX management team knows it. It has always been discussed but they just don’t like what the comparison reveals. The Goldman banker we brought in coined the term peer of one and management loved it. Allowed them to distance themselves from reality. After he was run off for being a misogynistic a-s, the new head of IR took the lead on running with the message with the backing of his former boss on the board.
Numbers don’t lie. MPC has a similar portfolio and is outpacing PSX at a clip this management team can’t possibly recover from.
@OP it’s pathetic.
Folks (most equity analysts) have correctly pointed out that despite “transformation”, that PSX’s performance given the huge Iran related headwind still isn’t equivalent to MPC and VLO. So they (ELT via their new IR guy) found one minor league bulge bracket sell side analyst to say that PSX is now an integrated. Which is a total joke when you consider just how different PSX midstream & 50 pct JV in Chems is from a true upstream operation (which is the major other side of the “new” peer groups integration other than Refining.
It’s a way to attempt to shade the continued performance gap that PSX will never close without major acquisition, divestiture or dis-integration (remember Elliott is still lurking) - and to attempt to change the VCIP and PSP matrices for next year in order to (of course) set up to pay themselves more in the future.
It’s a joke. And shambolic as I stated earlier. When a respected buy side analyst (maybe both heads of IR’s prior employers, maybe???) stands on a mountain and says that PSX now belongs in a different peer group, I’ll listen.
But this is beyond weak and a grasp at changing the narrative before the Iran tailwind fades. I’d not read it as any more (or less) than that.
Also - MPC and its bits & bobs is reasonably diverse.