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Phillips 66’s Beta: Does It Imply That PSX Is Less Volatile?

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Phillips 66’s beta

In this part, we’ll consider the 90-day beta, which depicts how much a stock moves in relation to a given daily move in the market for 90 days. Phillips 66’s (PSX) 90-day beta stood at 1.2 on March 16, 2017, below its peer average of 2.1. 

Phillips 66’s beta is the lowest among the refining stocks in the US. In contrast, Alon USA Energy’s (ALJ) 90-day beta is 2.9, the highest among its peers.

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Peers’ beta readings

Among the larger players, Tesoro (TSO), Valero Energy (VLO), and Marathon Petroleum (MPC) trade below the peer average at 1.6, 1.6, and 2.0, respectively. Among the smaller refining stocks, Delek US Holdings (DK), HollyFrontier (HFC), Western Refining (WNR), and CVR Refining (CVRR) trade above the peer average at 2.6, 2.2, 2.2, and 2.7, respectively, implying higher volatility in these stocks.

For exposure to small-cap stocks, you can consider the iShares Russell 2000 Value ETF (IWN). IWN has ~5% exposure to energy sector stocks, including DK, WNR, and ALJ.

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