A Shocking Lack of Ambition

Phillips 66 (NYSE: PSX) stock has underperformed its peers for a decade. Now, the CEO is talking down the value of his own company’s shares, saying they are already fully valued.

Strong leadership aims to beat and raise expectations.
Weak leadership works to lower expectations.

A Shocking Lack of Ambition

Phillips 66 (NYSE: PSX) stock has underperformed its peers for a decade. Now, the CEO is talking down the value of his own company’s shares, saying they are already fully valued.

Strong leadership aims to beat and raise expectations. Weak leadership works to lower expectations.

Phillips 66 leadership is willing to undermine its own stock price in pursuit of self-preservation

“In a somewhat surprising tactic, PSX management talked down the potential [sum-of-the-parts] upside (i.e., [stating that the Company is] fairly valued)….”

– Piper Sandler, March 2025

After recent meetings with Phillips 66, some investors shared with us their impression that the CEO was pitching a short thesis on his own company’s stock. One investor concluded that the management team must be more concerned about maintaining their compensation than increasing the stock price.

These sentiments echoed statements in a recent Elliott-sponsored, third-party survey of institutional investors:

“The biggest issue for Phillips, in my opinion, is that they are not at all focused on creating shareholder value. They are focused on status quo.”
Phillips 66 Shareholder A
“If I were being harsh, and I think it is appropriate, I would almost say that they are just trying to coast along.”
Phillips 66 Shareholder B

We and Wall Street Analysts See Profound Stock Price Upside

Elliott View of Value

(1) Source: Bloomberg as of February 7, 2025. (2) Price target is based on Elliott’s internal calculations. More information and analysis can be found at Streamline66.com.

“[We] believe PSX is currently trading below its SOTP and could see meaningful upside in a breakup scenario…”
ScotiabankFebruary 2025
“[There is] significant upside to a SOTP-based valuation…”
J.P. MorganFebruary 2025
“[Our view is] that PSX is undervalued – and there is merit to shining a light on embedded value.”
Wolfe ResearchFebruary 2025

The Choice for Shareholders

  • Complacent leadership that does not see any upside opportunity
  • Highly credible independent directors nominated by a shareholder that sees a clear path to a $200+ share price

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