Price to FCFE (P/FCFE)
Free Cash Flow to Equity (FCFE)
Phillips 66, FCFE calculation
US$ in millions
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
The financial performance from 2015 to 2019 is characterized by significant volatility in both cash generation from operations and the resulting cash available to equity holders. A general pattern of fluctuation is evident, with a notable peak in liquidity and cash flow efficiency occurring in 2018, followed by a contraction in 2019.
- Net Cash Provided by Operating Activities
- Operating cash flows experienced a substantial decline between 2015 and 2016, falling from 5,713 million USD to 2,963 million USD. A recovery phase followed, with values increasing to 3,648 million USD in 2017 and reaching a five-year peak of 7,573 million USD in 2018. However, this momentum was not sustained into 2019, as operating cash flows decreased to 4,808 million USD.
- Free Cash Flow to Equity (FCFE) Trends
- FCFE exhibited more aggressive variance than operating cash flows. In 2015, FCFE was minimal at 192 million USD, despite relatively strong operating cash flows. A sharp upward trajectory began in 2016, with FCFE rising to 1,376 million USD and continuing to 1,646 million USD in 2017. A massive surge occurred in 2018, where FCFE reached 5,974 million USD, before dropping sharply to 1,411 million USD in 2019.
- Cash Flow Conversion and Utilization
- The relationship between operating cash flow and FCFE indicates shifting capital allocation priorities. In 2015, a vast majority of operating cash was absorbed by capital expenditures or debt repayments, leaving only a small fraction for equity holders. By 2018, the conversion rate improved significantly, with FCFE representing a much larger proportion of operating cash. The abrupt decline in FCFE in 2019, while operating cash flows remained moderately strong, suggests a return to higher capital outflows or debt servicing during that period.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?
Price to FCFE Ratio, Current
Phillips 66, current P/FCFE calculation, comparison to benchmarks
| No. shares of common stock outstanding | 439,445,842 |
| Selected Financial Data (US$) | |
| Free cash flow to equity (FCFE) (in millions) | 1,411) |
| FCFE per share | 3.21 |
| Current share price (P) | 89.25 |
| Valuation Ratio | |
| P/FCFE | 27.80 |
| Benchmarks | |
| P/FCFE, Competitors1 | |
| Chevron Corp. | 18.70 |
| ConocoPhillips | 25.86 |
| ExxonMobil Holdings Corp. | 28.59 |
Based on: 10-K (reporting date: 2019-12-31).
1 Click competitor name to see calculations.
If the company P/FCFE is lower then the P/FCFE of benchmark then company is relatively undervalued.
Otherwise, if the company P/FCFE is higher then the P/FCFE of benchmark then company is relatively overvalued.
Price to FCFE Ratio, Historical
Phillips 66, historical P/FCFE calculation, comparison to benchmarks
| Dec 31, 2019 | Dec 31, 2018 | Dec 31, 2017 | Dec 31, 2016 | Dec 31, 2015 | ||
|---|---|---|---|---|---|---|
| No. shares of common stock outstanding1 | 439,445,842 | 454,913,087 | 501,237,339 | 517,816,429 | 527,459,894 | |
| Selected Financial Data (US$) | ||||||
| Free cash flow to equity (FCFE) (in millions)2 | 1,411) | 5,974) | 1,646) | 1,376) | 192) | |
| FCFE per share3 | 3.21 | 13.13 | 3.28 | 2.66 | 0.36 | |
| Share price1, 4 | 89.25 | 97.36 | 91.83 | 78.66 | 80.09 | |
| Valuation Ratio | ||||||
| P/FCFE5 | 27.80 | 7.41 | 27.96 | 29.60 | 220.02 | |
| Benchmarks | ||||||
| P/FCFE, Competitors6 | ||||||
| Chevron Corp. | — | — | — | — | — | |
| ConocoPhillips | — | — | — | — | — | |
| ExxonMobil Holdings Corp. | — | — | — | — | — | |
Based on: 10-K (reporting date: 2019-12-31), 10-K (reporting date: 2018-12-31), 10-K (reporting date: 2017-12-31), 10-K (reporting date: 2016-12-31), 10-K (reporting date: 2015-12-31).
1 Data adjusted for splits and stock dividends.
3 2019 Calculation
FCFE per share = FCFE ÷ No. shares of common stock outstanding
= 1,411,000,000 ÷ 439,445,842 = 3.21
4 Closing price as at the filing date of Phillips 66 Annual Report.
5 2019 Calculation
P/FCFE = Share price ÷ FCFE per share
= 89.25 ÷ 3.21 = 27.80
6 Click competitor name to see calculations.
The analysis of the Price to Free Cash Flow to Equity (P/FCFE) ratio between 2015 and 2019 reveals significant volatility driven primarily by fluctuations in cash flow generation rather than share price movements. While the share price remained relatively stable, oscillating between 78.66 and 97.36, the FCFE per share experienced extreme variance, leading to a highly inconsistent valuation multiple.
- Initial Valuation Anomaly (2015)
- A disproportionately high P/FCFE ratio of 220.02 was recorded in 2015. This outlier was the result of a minimal FCFE per share of 0.36 against a share price of 80.09, indicating a period where cash flows available to equity holders were nearly exhausted or heavily constrained.
- Stabilization Period (2016-2017)
- The ratio normalized significantly following 2015, settling into a range between 27.96 and 29.60. This stabilization coincided with FCFE per share rising to 2.66 in 2016 and 3.28 in 2017, suggesting a more sustainable relationship between the market price and the company's cash flow generation.
- Peak Cash Flow Event and Reversion (2018-2019)
- A sharp contraction in the P/FCFE ratio occurred in 2018, reaching a low of 7.41. This was driven by a substantial surge in FCFE per share to 13.13, the highest in the analyzed period, occurring simultaneously with the peak share price of 97.36. By 2019, the ratio reverted to 27.80 as FCFE per share declined back to 3.21, returning the valuation multiple to levels consistent with the 2016-2017 period.
Overall, the data indicates that the P/FCFE ratio for this period was highly sensitive to non-linear changes in free cash flow. The convergence of the ratio to approximately 28x in 2016, 2017, and 2019 suggests a baseline valuation multiple, while the 2015 and 2018 figures represent extreme deviations caused by temporary fluctuations in cash flow availability.
AI Ask an analyst for more
Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.
How can I help you?