Phillips 66 (PSX) Stock Analysis & Winston Score

Phillips 66 turns crude oil into products people use every day — gasoline, diesel, jet fuel, and chemicals. It sells these products to gas stations, airlines, trucking companies, and industrial customers across the United States and internationally. The company also owns the 76 and Conoco fuel brands at the retail level, and operates one of the largest refining networks in the United States. Phillips 66 makes money by buying crude oil, refining it, and selling the finished products at a markup — a business called "crack spread" economics, where profits depend on the gap between crude costs and fuel prices. It operates refineries, pipelines, chemical plants, and fuel terminals mainly in the U.S., with some international exposure through its chemicals joint venture with Chevron called CPChem. The company's scale and integrated midstream assets give it some cost advantages, but its biggest risk is that refining margins are highly cyclical and can compress sharply when crude oil prices rise faster than fuel prices.