Using the PEG framework with analyst consensus forward EPS growth of 9.3% plus 2.6% dividend yield, Phillips 66 has a fair value of $115.37 based on NTM EPS (FY2026) of $12.39. The current PEG ratio is 1.61.
PEG < 1 = bargain, 1–1.5 = fair, > 2 = expensive.
PEG tends to undervalue slow growers — consider dividend yield and asset value instead.
| EPS Growth RateForward | 6.7% |
| Dividend Yield | +2.6% |
| Adjusted Growth (clamped 8–25%) | 9.3% |
| Fair P/E | 9.3x |
| NTM EPS (FY2026) | $12.39 |
| Fair Value | $115.37 |
| Period | EPS Est. | Growth | Analysts |
|---|---|---|---|
| FY2025 (actual) | $10.79 | — | — |
| FY2026E | $12.39 | +14.8% | 8 |
| FY2027E | $13.25 | +6.9% | 7 |
| FY2028E | $13.12 | -1.0% | 5 |
3Y Forward EPS CAGR: 6.7%
| Year | Net Income | EPS | YoY |
|---|---|---|---|
| FY2021 | $1.3B | $2.97 | — |
| FY2022 | $11.0B | $23.27 | +683.5% |
| FY2023 | $7.0B | $15.45 | -33.6% |
| FY2024 | $2.1B | $4.99 | -67.7% |
| FY2025 | $4.4B | $10.79 | +116.2% |
4Y Historical EPS CAGR: 38.1%
The PEG Fair Value uses the Price/Earnings-to-Growth framework. A stock is fairly valued when its P/E ratio equals its earnings growth rate (PEG = 1.0). This model adds dividend yield to the growth rate per the original PEGY formula.
Growth rate priority: analyst consensus forward EPS CAGR (when ≥ 3 analysts cover the stock), falling back to historical EPS CAGR. Using EPS rather than net income avoids distortion from share buybacks. The growth rate is clamped between 8% and 25% — below 8% would undervalue stable earners, while above 25% would overvalue unsustainable spikes.