Phillips 66 remains undervalued despite refining volatility, with Wells Fargo setting a $201 price target amid cost cuts and supply disruptions.
Wells Fargo analyst Sam Margolin maintained a Buy rating on Phillips 66 (PSX) and raised the price target to $201, citing long-term growth potential. The firm highlighted the stock’s undervaluation amid broader market volatility in refining and petrochemical sectors.
Phillips 66 CEO Mark Lashier noted ongoing disruptions in the Strait of Hormuz, which have trapped 90 to 100 million barrels of crude oil, delaying supply normalization. The company has reduced refining costs by $1 per barrel, targeting further cuts to $5.50, though California operations remain at $15 per barrel.
Lashier also reported improved refinery performance, with higher utilization and increased production of high-value products. The supply bottleneck and regional cost disparities continue to pressure margins, but the company expects gradual recovery.