This week, I build on my last week’s blog post. In this video blog, I fundamentally analyze Phillips 66 Partners’ stock. I review PSXP’s Business Setup, Annual Report, Risk Factors, Key Ratios, PSX’s (Phillip 66 – General Partner) Key Ratios. I use the facts available to determine if PSXP is undervalued or not.
Phillips 66 Partners LP owns, operates, develops, and acquires midstream assets. It offers transportation, terminaling, processing, and storage and fractionation of refined petroleum products and natural gas liquids. Most of PSXP’s revenue comes from a fee based structure and partnership agreement with Phillips 66. So, PSXP’s revenue stream is resistant from fluctuating crude oil prices. As value investors, it is important to review the company’s fundamentals before deciding to invest in any company. Hope you all find this 25.5 minute video blog interesting. Since this is a long video, please feel free to use the time stamps in the video if you only wish to watch certain topics.
I review various key ratios such as Revenue, Net Income, Shares outstanding, Dividends, Payout Ratio, Free Cash Flows (FCF), Financial Leverage, Current Ratio, Debt to Equity Ratio, Return on Equity (ROE), etc. I also review the key ratios of Phillips 66, which is the company that Phillips 66 Partners does majority of the business with. If the customer (Phillips 66) is financially sound, then Phillips 66 partners should not have any hiccups with its future revenue stream. Lastly, I use the traditional Ben Graham’s valuation methods to determine if PSXP is undervalued on not.
1:17 Organizational Structure
3:12 Recent Projects / Developments
4:06 Agreements, Competition
5:15 Risk Factors
10:04 Key Ratios Analysis (PSXP)
18:15 Key Ratio Analysis (PSX)
21:08 Summary / Conclusion
10K Annual Report: here
Morningstar Key Ratios Link: here.
Useful Resources here.
Company overview: The company was founded in 2013 and is headquartered in Houston, Texas. Phillips 66 Partners LP operates as a subsidiary of Phillips 66.
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