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Phillips 66 Financial Strength

: 6 (As of Mar. 2019)
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Phillips 66 has the Financial Strength Rank of 6.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

Phillips 66 did not have earnings to cover the interest expense. Phillips 66's debt to revenue ratio for the quarter that ended in Mar. 2019 was 0.49. As of today, Phillips 66's Altman Z-Score is 3.81.


Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


Phillips 66 Financial Strength Distribution

* The bar in red indicates where Phillips 66's Financial Strength falls into.



Phillips 66 Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

Phillips 66's Interest Expense for the months ended in Mar. 2019 was $-119 Mil. Its Operating Income for the months ended in Mar. 2019 was $-46 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Mar. 2019 was $11,268 Mil.

Phillips 66's Interest Coverage for the quarter that ended in Mar. 2019 is

Phillips 66 did not have earnings to cover the interest expense.

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

Phillips 66's Debt to Revenue Ratio for the quarter that ended in Mar. 2019 is

Debt to Revenue Ratio=Total Debt (Q: Mar. 2019 ) / Revenue (Q: Mar. 2019 )
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(30 + 11268) / 23103
=0.49

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

Phillips 66 has a Z-score of 3.81, indicating it is in Safe Zones. This implies the Z-Score is strong.

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.


Phillips 66  (NYSE:PSX) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

Phillips 66 has the Financial Strength Rank of 6.


Phillips 66 Financial Strength Explanation


Phillips 66 Financial Strength Headlines

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