#3 Phillips 66 (NYSE:PSX)
– Investors with Long Positions (as of December 31): 35
– Aggregate Value of Investors’ Holdings (as of December 31): $6.72 billion
Ownership of Phillips 66 (NYSE:PSX) among investors in our system inched up by two during the fourth quarter, while the aggregate value of their holdings in the company remained unchanged. While several of its integrated peers have been hit hard because of the decline in crude oil and natural gas prices, by virtue of being largely a downstream refiner, Phillips 66 (NYSE:PSX) hasn’t suffered the same fate. Shares of the company have appreciated by over 7% this year and still sport a respectable annual dividend yield of 2.54%. Phillips 66’s chemical business has helped it maintain its cash flows and is expected to continue doing so in the future, which is why investors and analysts are not worried about the decline in the company’s refining margins. On March 13, analysts at Raymond James boosted their price target on the stock to $92 from $88. With ownership of almost 61.5 million shares of the company, Warren Buffett‘s Berkshire Hathaway continued to remain the largest shareholder of the company in our database at the end of December.
#2 Marathon Petroleum Corp (NYSE:MPC)
– Investors with Long Positions (as of December 31): 50
– Aggregate Value of Investors’ Holdings (as of December 31): $2.58 billion
During the October-to-December period, investors in our system with long positions in Marathon Petroleum Corp (NYSE:MPC) inched up by four and the aggregate value of their holdings in the company also saw an increase of $91 million. However, investors which initiated a stake in the company during that period, which included Clint Carlson‘s Carlson Capital, might be regretting their decision right now, since shares of Marathon Petroleum Corp (NYSE:MPC) have fallen by almost 30% so far this year. On February 25, the company announced that its CEO and President Gary Heminger will also become its Chairman, replacing Thomas Usher, who plans to retire after the company’s annual shareholder meeting on April 27. A few days later, the company disclosed that it has agreed to drop-down its fee-based inland marine assets to MPLX LP (NYSE:MPLX) in exchange for $600 million worth of equity in the latter.
#1 Valero Energy Corporation (NYSE:VLO)
– Investors with Long Positions (as of December 31): 51
– Aggregate Value of Investors’ Holdings (as of December 31): $1.76 billion
Despite its ownership among top investors decreasing by five and the aggregate value of their holdings in it coming down by $83 million during the fourth quarter, Valero Energy Corporation (NYSE:VLO) was still the most popular gas station stock among the funds we follow at the end of December. Notable investors which increased their stakes in the company substantially during the fourth quarter included Jim Simons‘ Renaissance Technologies and Israel Englander‘s Millennium Management. Shares of the company have fallen by over 8% this year and most analysts feel they are a bargain at current levels. Analyst bullishness stems from the company’s better-than-expected financial performance over the past five quarters, the strong free cash flow it generates and the low trailing P/E of 8.33 at which the stock currently trades. Furthermore, analysts believe that Valero Energy Corporation (NYSE:VLO) is better protected than its peers from major headwinds and is also better positioned to grow its earnings in the coming quarters. According to recent reports, Valero Energy Corporation could be a potential buyer of gas station and convenience store operator Sunoco LP (NYSE:SUN). The 21 prominent analysts and research houses that cover Valero Energy currently have an average rating of ‘Buy’ and an average price target of $76.59 on it.