Phillips 66 PSX
Phillips 66's refining-plus-midstream conglomerate trades at a 6.1x discount to an 8.1x SOTP; breaking it up and replacing complacent directors unlocks ~75% upside to $183.
Thesis
Elliott argues Phillips 66 is a structurally undervalued energy conglomerate that has trailed core peers Valero and Marathon by 450% since its 2012 ConocoPhillips spinoff, with refining and midstream businesses bolted together at a 6.1x EBITDA multiple versus an 8.1x sum-of-the-parts. CEO Mark Lashier has doubled down on dilutive midstream M&A — including the $2.2bn EPIC NGL deal — while opex per barrel has risen to ~$8 (vs Valero's $5) and the company missed its $14bn mid-cycle EBITDA target. After a year of stalled private engagement, Elliott is running a proxy fight for four independent directors (Coffman, Cornelius, Heim, Nieuwoudt) and is invoking the Marathon Petroleum precedent — where Elliott's prior campaign drove the $17bn Speedway divestiture and 149% TSR outperformance — to argue Phillips can be similarly restored, generating ~75% upside to $183/share.
SCQA
Phillips 66 is a $42bn diversified energy company with refining, midstream, marketing and chemicals segments — the third-largest U.S. independent refiner — spun out of ConocoPhillips in 2012.
PSX has trailed Valero and Marathon by 450% since spinoff because management bolted a midstream growth strategy onto a refining business, eroded operational discipline (opex/bbl now highest in the peer group), and the board has rewarded the underperformance.
Elect Elliott's four-director slate, separate midstream from refining, divest CPChem and JET, refocus on refining excellence, and restore board accountability after Lashier's combined Chairman/CEO promotion.
An 8.1x SOTP multiple versus today's 6.1x plus operational fixes implies ~$19bn of trapped value and ~$7bn of operating upside — a roughly 75% move from $103 to $183 per share.
The three reasons
- 1
Phillips 66 has underperformed core peers Marathon and Valero by 450% since the ConocoPhillips spinoff
- 2
Conglomerate structure traps ~$19bn of value plus ~$7bn from operational fixes (SOTP 8.1x vs PSX 6.1x)
- 3
Board is committed to status quo; new directors can unlock 75% upside ($103 to $183 per share)
Primary demands
- Elect Elliott's four shareholder-nominated directors (Brian Coffman, Sigmund Cornelius, Michael Heim, Stacy Nieuwoudt) at the 2025 Annual Meeting
- Separate midstream business from refining via spin-off or sale to dismantle the conglomerate structure
- Explore divestiture of CPChem joint-venture interest and JET retail marketing assets
- Refocus management on refining operational excellence and close the ~$3.75/bbl EBITDA gap to Valero
- Restore board accountability after Mark Lashier's elevation to combined Chairman/CEO role
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Mark Lashier (Chairman & CEO) and...
Present
Present
Present
Present
—
Yes
Yes
Yes
Active
4/5
N:5 V:4
Precedents cited
- Marathon Petroleum / Speedway divestiture (Elliott 2019-2021 campaign — 149% TSR outperformance)
- Suncor Energy turnaround (Elliott 2022 — 52% TSR, +22% vs XEG)
- NRG Energy capital allocation reset (Elliott 2017 — 767% TSR, +656% vs XLU)
Notable slides (6)
Notes
Filed in 14_Icahn folder but document is Elliott Investment Management's 'Streamline 66' proxy-fight presentation against Phillips 66, dated May 12, 2025 (filed as EX-99.1 to DFAN14A nine days before the May 21, 2025 annual meeting). Document includes the deck (pp. 1-22) plus appendices of social media posts (pp. 24-29) and Streamline66.com website screenshots (pp. 31-35). Strong rhetorical playbook: SCQA-clean, named villains, CEO quote contradictions ('we can be bigger than that'), explicit before/after Marathon analogue, branded campaign identity (Streamline 66 logo styled like a US highway shield). Stake not disclosed in this document though Elliott's PSX position has been widely reported in the press.