Chevron vs Phillips 66 Which Performs Better?

Chevron and Phillips 66 are two prominent companies in the energy sector, both offering unique investment opportunities for shareholders. Chevron, one of the largest integrated energy companies in the world, is known for its stable dividend payments and strong global presence. On the other hand, Phillips 66, a leading refining and marketing company, offers potential for growth and innovation in the industry. Both stocks have their own strengths and weaknesses, making them attractive options for investors seeking exposure to the energy sector.

Chevron or Phillips 66?

When comparing Chevron and Phillips 66, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Chevron and Phillips 66.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Chevron has a dividend yield of 4.21%, while Phillips 66 has a dividend yield of 3.63%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Chevron reports a 5-year dividend growth of 6.16% year and a payout ratio of 70.19%. On the other hand, Phillips 66 reports a 5-year dividend growth of 6.26% year and a payout ratio of 55.42%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Chevron P/E ratio at 16.70 and Phillips 66's P/E ratio at 15.36. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Chevron P/B ratio is 1.78 while Phillips 66's P/B ratio is 1.80.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Chevron has seen a 5-year revenue growth of 0.25%, while Phillips 66's is 0.38%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Chevron's ROE at 10.47% and Phillips 66's ROE at 11.27%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $154.27 for Chevron and $123.23 for Phillips 66. Over the past year, Chevron's prices ranged from $135.37 to $167.11, with a yearly change of 23.45%. Phillips 66's prices fluctuated between $119.77 and $174.08, with a yearly change of 45.35%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.