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Strategies & Market Trends : Value Investing

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Jurgis Bekepuris

To: Jurgis Bekepuris who wrote (56856)	8/16/2016 6:52:17 AM
From: Spekulatius	1 Recommendation Read Replies (1) of 78670

PSX looks expensive to me and I am surprised, BRK added to their position. It trades at more than 10x earnings and it looks like the refinery business has started a downturn (WTI - Brent spread is lower) and there is more capacity to process the excess crude in the US, lowering margins probably permanently. Moreover, basic chemical pricing for ethylene and propane is weak as well - that is an another important business line for PSX. They do have a logistic business (that is being monetized in PSXP), but it's not large enough to make up for margin losses in the main business.

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