As the general rout in Energy stocks continues in reaction to an ever decreasing oil price and China slowdown concerns, sector favourite Phillips 66 is displaying some positive factors on OTAS ahead of its earnings report in 22 days. Following the -16% fall from its December highs, fundamental and sentiment indicators suggest there is a currently degree of optimism for the shares…….
Insiders
Berkshire Hathaway have been back in the market and bought another $4m worth of stock in recent days. This follows on from their significant purchases noted back in September. As our analysis shows they rank with 3 stars(when considering previous transactions) as their market timing was astute.
EPS Momentum
The average analyst consensus EPS estimates have been revised up by +2.2% in the last month, this puts Phillips 66 in the top 10% of its sector for upgrades. The price vs fwd EPS chart shows a close correlation over the last year however that trend has seemingly dislocated over the last month potentially providing an opportunity.
Short Interest
The current % of free float share on loan is around 1.2% and is mid range compared to its 2 years average, however, there has been a discernible contraction(approximately half) in the total number through December in reaction to the falling share price suggesting negative bets are being reduced.
Other notables:
Positive technicals with a MACD Buys signal firing 3 days ago(it has also hit its lower Bollinger Band).
Currently rated a consensus Buy amongst analysts and trades at a 23% discount to its mean Price Target
Despite the fall in share price implied volatility relative to the sector remains very low – arguably seen as a positive for long term equity investors.
