HollyFrontier (HFC), Phillips 66 (PSX), Marathon Petroleum (MPC), and Valero Energy (VLO) are covered by 16, 18, 17, and 19 Wall Street analysts, respectively. Among the analysts, 31%, 56%, 100%, and 63% rated HollyFrontier, Phillips 66, Marathon Petroleum, and Valero Emergy as a “buy,” respectively. In this part, we’ll discuss analysts’ ratings for Marathon Petroleum and Phillips 66.
Marathon Petroleum is growing due to its capex and acquisitions. The company’s latest acquisition was Andeavor. Wall Street analysts expect the company’s earnings to increase 34% in 2018 and 42% in 2019. Marathon Petroleum will likely benefit from merger synergies and growth activities.
Marathon Petroleum’s mean target price is $98 per share, which implies a 57% gain from the current level–the highest among its peers.
Phillips 66 is an integrated and diversified downstream company. During periods with lower refining earnings, other segments (like Midstream, Chemicals, and Marketing) contribute to the overall earnings and shield Phillips 66 from volatility in the refining environment. Phillips 66 plans to grow these segments through its capex and acquisitions. Phillips 66 has strong financials. The company has comfortable debt and a favorable liquidity position.
However, Phillips 66 trades at a premium to the peer average, which has led to mixed ratings for the company. Phillips 66’s mean target price is $121 per share, which implies a 32% gain from the current level.