Tuesday, September 15, 2015

PSX blog

PSX- Trading at as low as $70.92 from the mid august crash Phillips 66 has rebounded nicely. Coming back off some good news deriving all the way from Warren Buffet taking a multi-billion dollar stake in the name to gains coming from plans to strengthen a joint venture. Phillips is trading right around $79.00/$80.00 today with majority of analysts ratings sitting at holds to buys.

On 9/9/15 PSX was up to $81.96 after the oil refinery company and Spectra Energy (SE) announced plans to strengthen their 50/50 joint venture DCP Midstream Partners (DPM). The transaction is expected to close in the fourth quarter ojf 2015. "DCP Midstream is a valuable portion of our NGL value chain and part of our plans to grow" said PSX Chairman and CEO Greg Garland.

I think a lot of the growth in this name will be derived from not its role as a refiner, which it just so happens to do very well, not in the rebound of oil which no one has a concrete timeline on, but on its diversification as its position to become an extremely large and profitable Pipeline and chemical company. A rebound in oil is viewed as just a bonus for this name in my eyes. I am more interested in its other business segments to carry the weight for growth.

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