Phillips 66 operates as an energy manufacturing and logistics company in the United States, the United Kingdom, Germany, and internationally. It operates through four segments: Midstream, Chemicals, Refining, and Marketing and Specialties (M&S). The Midstream segment transports crude oil and other feedstocks; delivers refined petroleum products to market; provides terminaling and storage services for crude oil and refined petroleum products; transports, stores, fractionates, exports, and markets natural gas liquids; provides other fee-based processing services; and gathers, processes, transports, and markets natural gas. The Chemicals segment produces and markets ethylene and other olefin products; aromatics and styrenics products, such as benzene, cyclohexane, styrene, and polystyrene; and various specialty chemical products, including organosulfur chemicals, solvents, catalysts, and chemicals used in drilling and mining. The Refining segment refines crude oil and other feedstocks into petroleum products, such as gasolines, distillates, aviation, and renewable. The M&S segment purchases for resale and markets refined petroleum products, including gasolines, distillates, and aviation fuels. This segment also manufactures and markets specialty products, such as base oils and lubricants. Phillips 66 was founded in 1875 and is headquartered in Houston, Texas.

Phillips 66

In the latest market close, Phillips 66 (PSX) reached $115.98, with a +1.8% movement compared to the previous day. The stock's change was more than the S&P 500's daily gain of 0.16%. At the same time, the Dow added 0.86%, and the tech-heavy Nasdaq lost 0.38%.
The oil refiner's shares have seen a decrease of 7.16% over the last month, surpassing the Oils-Energy sector's loss of 9.81% and falling behind the S&P 500's loss of 2.2%.
Market participants will be closely following the financial results of Phillips 66 in its upcoming release. The company plans to announce its earnings on January 31, 2025. In that report, analysts expect Phillips 66 to post earnings of $0.81 per share. This would mark a year-over-year decline of 73.79%. Meanwhile, our latest consensus estimate is calling for revenue of $31.99 billion, down 17.41% from the prior-year quarter.
Investors should also pay attention to any latest changes in analyst estimates for Phillips 66. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.
Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.
The Zacks Rank system, which varies between #1 (Strong Buy) and #5 (Strong Sell), carries an impressive track record of exceeding expectations, confirmed by external audits, with stocks at #1 delivering an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has witnessed a 6.42% decrease. As of now, Phillips 66 holds a Zacks Rank of #3 (Hold).
Investors should also note Phillips 66's current valuation metrics, including its Forward P/E ratio of 13.01. For comparison, its industry has an average Forward P/E of 14.69, which means Phillips 66 is trading at a discount to the group.
It is also worth noting that PSX currently has a PEG ratio of 3.25. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. Oil and Gas - Refining and Marketing stocks are, on average, holding a PEG ratio of 2.39 based on yesterday's closing prices.
The Oil and Gas - Refining and Marketing industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 189, which puts it in the bottom 25% of all 250+ industries.
The Zacks Industry Rank assesses the strength of our separate industry groups by calculating the average Zacks Rank of the individual stocks contained within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Make sure to utilize Zacks.com to follow all of these stock-moving metrics, and more, in the coming trading sessions.
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Phillips 66 (PSX) Beats Stock Market Upswing: What Investors Need to Know

With West Texas Intermediate (WTI) oil prices currently trading below $60 per barrel, according to data from Oilprice.com, which is significantly lower than a year ago, the overall energy business is now highly uncertain. However, unlike many other energy players, Phillips 66 PSX is likely to gain from the ongoing crude pricing environment.
This is because Phillips 66 is a leading refining company. As a refining player, PSX is now able to purchase oil at a lower cost, enabling the production of end products. Additionally, crude prices are likely to remain soft in the coming days, as the U.S. Energy Information Administration (“EIA”) expects global oil inventories to continue increasing.
EIA projects the spot average West Texas Intermediate price for 2026 at $51.42 per barrel, lower than the estimated $65.32 per barrel for 2025. Thus, Phillips 66, which generates significant margin from its refining activities, is likely to benefit from soft oil prices.
VLO & PARR Also Poised to Gain
Valero Energy Corporation VLO and Par Pacific Holdings Inc. PARR, two other well-known refiners, are also likely to benefit from the ongoing relatively low oil prices.
Valero Energy, with 15 refineries, has a throughput capacity of 3.2 million barrels per day. VLO mentioned that its refining activities are capable of generating sufficient cash flows to support shareholders’ returns along with growth.
Par Pacific is mainly a refining company with the capacity to process 219,000 barrels of oil daily. Notably, having exposure to Canadian heavy oil, which is cheaper than lighter crude, Par Pacific is likely to have been enjoying a cost advantage.
PSX’s Price Performance, Valuation & Estimates
Shares of PSX have gained 15.4% over the past year compared with the 16.2% rise of the composite stocks belonging to the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, PSX trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 13.57X. This is above the broader industry average of 4.34X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PSX’s 2025 earnings has seen downward revisions over the past 30 days.
Image Source: Zacks Investment Research
PSX currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Will the Oil Price Environment Aid PSX's Refining Operations?

With West Texas Intermediate (WTI) oil prices currently trading below $60 per barrel, according to data from Oilprice.com, which is significantly lower than a year ago, the overall energy industry is now highly uncertain. However, unlike many other energy players, Valero Energy Corporation VLO is likely to gain from the ongoing crude pricing environment.
This is because Valero Energy is a leading refining company with the capacity to process 3.2 million barrels of oil daily. VLO is now able to purchase oil at a lower cost, enabling the production of end products, such as gasoline and distillates. Additionally, crude prices are likely to remain soft in the coming days, as the U.S. Energy Information Administration (“EIA”) expects global oil inventories to continue increasing.
EIA projects the spot average West Texas Intermediate price for 2026 at $51.42 per barrel, lower than the estimated $65.32 per barrel for 2025. Thus, Valero Energy, which generates significant margin from its refining activities, is likely to benefit from soft oil prices.
PSX & PARR Also Poised to Gain
Phillips 66 PSX and Par Pacific Holdings Inc. PARR, two other well-known refiners, are also likely to benefit from the ongoing relatively low oil prices.
Refining operations continue to contribute to PSX’s earnings. Moreover, Phillips 66 expects refining to continue to back its bottom line considerably after its midstream activities.
Par Pacific is mainly a refining company with the capacity to process 219,000 barrels of oil daily. Notably, having exposure to Canadian heavy oil, which is cheaper than lighter crude, Par Pacific is likely to have been enjoying a cost advantage.
VLO’s Price Performance, Valuation & Estimates
Shares of VLO have gained 35.1% over the past year compared with the 16.2% rise of the composite stocks belonging to the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, VLO trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 7.77X. This is above the broader industry average of 4.34X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for VLO’s 2025 earnings has seen downward revisions over the past 30 days.
Image Source: Zacks Investment Research
VLO currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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Is the Current Oil Price Favorable for VLO's Refining Operations?

Par Pacific Holdings, Inc. PARR is a Houston-based refining player with a combined refining capacity of 219,000 barrels per day and operations spread across Hawaii and the Pacific Northwest. The company also operates 119 retail locations, along with a logistics business segment. Since the company is primarily involved in the refining business, it is worthwhile to assess whether the current refining environment is beneficial for Par Pacific.
Refining players have seen a significant boost in earnings in 2025 compared with the previous year, supported by strong refining margins throughout the year. In the United States, refining margins have significantly risen in 2025, driven by tightened supply due to refinery maintenance and outages, as well as growing demand for distillate fuels. Par Pacific also reported a significant increase in third-quarter 2025 refining earnings to $340.8 million, up from $19 million in the corresponding period of 2024.
Management has stated that the market outlook appears positive for the fourth quarter as well. This implies that the company is expected to benefit from a supportive macro refining environment in Q4, likely due to tightening supply and demand dynamics and geopolitical tensions and sanctions. The company has also highlighted that the strong Singapore margin environment, partially driven by geopolitical disruptions restricting crude flows into Asian countries and higher seasonal distillate demand, is beneficial for its distillate-oriented refineries.
Hence, the current refining environment appears favorable for Par Pacific Holdings, and the company is well-positioned to continue generating strong earnings in the near term.
PSX & VLO Are Two Other Leading Refiners
Phillips 66 PSX and Valero Energy Corporation VLO are two leading refining players expected to benefit from strong refining margins. Both PSX and VLO sport a Zacks Rank #1 (Strong Buy).
Phillips 66 operates 11 refineries across the United States and Europe. The company recorded a 99% crude utilization rate in the third quarter, the highest since 2018. Its refining results benefit from strong margins seen this year. Further, its involvement in other segments, including midstream, renewables, and chemicals, provides earnings stability.
Valero Energy boasts an extensive refinery network, with 15 refineries and a combined throughput capacity of 3.2 million barrels per day. VLO’s diversified refinery base enables it to tap into different markets and cater to a diverse range of customer needs.
PARR’s Price Performance, Valuation & Estimates
Shares of PARR have surged 116.1% over the past year compared with the 15.3% improvement of the composite stocks belonging to the industry.
Image Source: Zacks Investment Research
From a valuation standpoint, PARR trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 4.45X. This is above the broader industry average of 4.36X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for PARR’s 2025 earnings has seen downward revisions over the past 30 days.
Image Source: Zacks Investment Research
Par Pacific currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank stocks here.
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Is Par Pacific Holdings Positioned for a Strong Finish to 2025?

As we look ahead to 2026, investors interested in the energy space should focus on stocks that are well placed to gain next year. While oil prices are expected to remain subdued in 2026, typically a headwind for much of the energy sector, not all stocks are vulnerable. In fact, companies such as Phillips 66 PSX, Valero Energy Corporation VLO, and Oceaneering International OII remain compelling opportunities that investors should not overlook.
Oil Price to Decline in 2026
The U.S. Energy Information Administration (“EIA”), in its latest short-term energy outlook, stated that the spot average price of West Texas Intermediate crude will be $65.32 per barrel this year, lower than the $76.60 per barrel recorded last year. For 2026, EIA expects the commodity price to decline further to $51.42 per barrel. EIA stated that rising worldwide oil inventory will hurt the commodity price.
Low oil prices benefit the refining industry, as companies process raw crude to produce final products like gasoline, diesel and jet fuel.Thus, softness in crude prices will likely benefit refining operations in 2026.
Also, with the advent of advanced drilling techniques like horizontal drilling and hydraulic fracturing (fracking), the cost of operations in oil and gas resources has declined considerably over the years, leading to low break-even costs. Thus, although oil prices will likely be soft next year, the cost of operations for exploration and production activities might be profitable. Since oilfield service companies assist upstream companies in efficiently drilling oil and gas wells, demand for oilfield services will likely be favorable in 2026.
3 Stocks to Bet on Right Away: PSX, VLO, OII
Phillips 66 is a leading refinerand generates significant earnings from its refining business.PSX recognized crude utilization of 99% in the September quarter of this year, which was the highest quarterly utilization since 2018. Phillips 66 is likely to maintain its strong margin since it is well-positioned to continue to use Canadian heavy crude, thereby replacing other sources that are becoming scarce.
Since PSX employs heavy crude, which trades at a discount to lighter crude like WTI, the company is well-positioned to capitalize on lower oil prices in 2026. PSX currently sports a Zacks Rank #1 (Strong Buy).
Valero Energy is a leading independent refiner in the world, having 15 refineries with a combined refining capacity of 3.2 million barrels per day. VLO is strongly focused on maximizing its profit through efficiently utilizing its refineries and through selectively investing in profitable projects.
Like Phillips 66, Valero Energy is also expected to capitalize on low input costs next year. VLO currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Oceaneering is well known for providing offshore energy companies with robotic solutions, along with engineered services and products and is thus part of the oilfield service space. For 2026, Zacks #1 Ranked OII expects its Aerospace and Defense (ADTech) business to continue contributing to its growth, with activities to pick up in the second and third quarters.
Notably, with oilfield services demand to remain favorable in 2026, Oceaneering is well-positioned to gain.
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3 Energy Stocks Investors Should Invest in Before 2025 is Over

Following strong interest from fuel suppliers and customers, Phillips 66 PSX and Kinder Morgan KMI plan to establish the Western Gateway Pipeline, a system that will transport refined fuel to western markets by upgrading and redirecting existing pipelines. The Western Gateway Pipeline combines both new and existing infrastructure to optimize delivery.
Although PSX and KMI recently closed the open season after receiving strong interest from fuel suppliers and customers, they plan to hold another round of sign-ups in January 2026 to allocate the remaining pipeline capacity due to continued high demand.
During the initial open season, several companies committed to shipping fuel through the upcoming Western Gateway Pipeline. In the next round, the pipeline will be extended farther west to deliver refined products to the Los Angeles market. The new pipeline will transport fuel from Borger, Texas, to Phoenix, Arizona, where it will connect to the existing SFPP pipeline. By reversing the flow of a portion of the SFPP pipeline between Watson, AZ, and Colton, CA, fuel can then be transported westward toward California.
PSX also plans to reverse the flow of its existing Gold Pipeline, which currently supplies fuel from Borger, TX, to the Midwest, allowing fuel to be transported from the Midwest to Borger, TX, and then onward to California via the Western Gateway Pipeline.
KMI also has an existing pipeline that transport fuels from El Paso, TX.
Refined products can be transported to California not only from refineries near Borger, TX, and El Paso, TX, but also from refineries near the Midwest.
KMI and PSX are midstream players generating stable fee-based revenues and are less vulnerable to volatility in oil and gas prices. Robust demand for Western Gateway Pipeline will not only bring stability to their business models but also generate additional cash flow with increased investor appeal in the coming days. KMI currently carries a Zacks Rank #3 (Hold) while PSX sports a Zacks Rank #1 (Strong Buy).
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Other midstream players in this space are The Williams Companies, Inc. WMB, and Enterprise Products Partners L.P. EPD, each carrying a Zacks Rank #3 at present. Like PSX and KMI, both energy infrastructure providers, WMB and EPD also generate stable fee-based revenues and are less exposed to oil and gas price volatility.
WMB, headquartered in Tulsa, OK, boasts a strong portfolio in the deepwater Gulf, the Rockies, the Pacific Northwest, and the Eastern Seaboard. WMB is preparing to meet rising energy needs and plans to invest $3.95 billion to $4.25 billion in capital expenditure by 2025 (for growth project) much higher than $1.5 billion spent in 2024.
Operating in many regions with diversified products, Enterprise Products Partners has a strong focus on returning capital to its unitholders through distribution and unit repurchases. With over 50,000 miles of pipeline, more than 300 million barrels of liquids storage and other infrastructure, it can serve products and services to multiple markets.
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PSX, KMI Wrap Up Initial Open Season for Western Gateway Pipeline

Here are three stocks with buy rank and strong income characteristics for investors to consider today, Dec. 19:
West Bancorporation, Inc. WTBA: This financial holding company has witnessed the Zacks Consensus Estimate for its current year earnings increasing 7.4% over the last 60 days.
West Bancorporation, Inc. Price and Consensus
This Zacks Rank #1 company has a dividend yield of 4.2%, compared with the industry average of 2.7%.
West Bancorporation, Inc. Dividend Yield (TTM)
Phillips 66 PSX: This energy manufacturing and logistics company has witnessed the Zacks Consensus Estimate for its current year earnings increasing 15.7% over the last 60 days.
Phillips 66 Price and Consensus
Phillips 66 price-consensus-chart | Phillips 66 Quote
This Zacks Rank #1 company has a dividend yield of 3.6%, compared with the industry average of 2.7%.
Phillips 66 Dividend Yield (TTM)
Phillips 66 dividend-yield-ttm | Phillips 66 Quote
Invesco Ltd. IVZ: This publicly owned investment manager has witnessed the Zacks Consensus Estimate for its current year earnings increasing 6.6% over the last 60 days.
Invesco Ltd. Price and Consensus
This Zacks Rank #1 (Strong Buy) company has a dividend yield of 3.2%, compared with the industry average of 2.7%.
Invesco Ltd. Dividend Yield (TTM)
See the full list of top ranked stocks here.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Best Income Stocks to Buy for Dec. 19

Here are five stocks added to the Zacks Rank #1 (Strong Buy) List today:
Phillips 66 PSX: This energy manufacturing and logistics company has seen the Zacks Consensus Estimate for its current year earnings increasing 15.7% over the last 60 days.
Phillips 66 Price and Consensus
Phillips 66 price-consensus-chart | Phillips 66 Quote
MongoDB, Inc. MDB: This provider of a database platform has seen the Zacks Consensus Estimate for its current year earnings increasing 27% over the last 60 days.
MongoDB, Inc. Price and Consensus
Hallador Energy Company HNRG: This steam coal company has seen the Zacks Consensus Estimate for its current year earnings increasing 84.9% over the last 60 days.
Hallador Energy Company Price and Consensus
SiriusPoint Ltd. SPNT: This insurance company has seen the Zacks Consensus Estimate for its current year earnings increasing 7.6% over the last 60 days.
SiriusPoint Ltd. Price and Consensus
John B. Sanfilippo & Son, Inc. JBSS: This tree nuts and peanuts company has seen the Zacks Consensus Estimate for its current year earnings increasing 7.8% over the last 60 days.
John B. Sanfilippo & Son, Inc. Price and Consensus
You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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New Strong Buy Stocks for Dec. 19: HNRG, PSX, and More

Key Points
The Vanguard High Dividend ETF holds over 500 high-yielding dividend stocks.
It includes several top energy dividend stocks, such as ExxonMobil and Chevron.
These leaders should continue increasing their high-yielding payouts in the future.
The Vanguard High Dividend Yield ETF (NYSEMKT: VYM) currently holds 566 high-yielding dividend stocks. It owns stocks in every sector. The energy industry is a meaningful contributor, accounting for 8.3% of the fund's holdings.
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ExxonMobil
Oil behemoth ExxonMobil (NYSE: XOM) is the third-largest holding in the Vanguard High Dividend ETF at 2.3% of the fund's assets. The energy giant is one of the best dividend stocks in the world. Exxon recently increased its dividend by another 4%, extending its growth streak to 43 straight years, the longest in the oil patch and a milestone achieved by fewer than 5% of companies in the S&P 500. Its payout now yields 3.5%, more than triple the S&P 500's level of 1.1%.
ExxonMobil should have plenty of fuel to continue increasing its high-yielding dividend. The company recently raised its 2030 plan. Exxon now expects to produce an additional $25 billion in earnings and $35 billion of cash flow by 2030 without boosting its capital spending plan. That will give it more cash to return to shareholders through future dividend increases.
Chevron
Chevron (NYSE: CVX) has a 1.4% allocation in the Vanguard High Dividend ETF. The oil giant is another leading dividend oil stock. Chevron has raised its payment for 38 straight years, delivering peer-leading growth over the past decade. The oil company's payout currently yields 4.6%.
It's also in a strong position to continue increasing its dividend payment. Chevron expects to grow its free cash flow at a more than 10% compound annual rate through 2030. The company anticipates benefiting from recently completed projects in Kazakhstan and the Gulf of Mexico, as well as its acquisition of Hess, which will significantly boost its free cash flow next year. Meanwhile, longer-term drivers, such as offshore Guyana (acquired in the Hess deal), will help fuel growth through 2030 as new developments come online.
ConocoPhillips
ConocoPhillips (NYSE: COP) has a 0.5% allocation in the fund. The oil and gas company recently increased its dividend by 8%, pushing the yield up to 3.4%. ConocoPhillips has boosted its payout every year since resetting the level nearly a decade ago.
The energy company aims to deliver dividend growth within the top 25% of companies in the S&P 500 in the future. It should have ample fuel to deliver on that objective. ConocoPhillips expects a combination of cost-saving initiatives and three liquefied natural gas (LNG) projects to add $1 billion to its annual free cash flow total each year through 2028. Meanwhile, it expects the completion of its Willow oil project to add another $4 billion to its free cash flow total in 2029. That has ConocoPhillips on track to roughly double its free cash flow over the next several years.
Williams
Williams (NYSE: WMB) has a 0.4% allocation in the Vanguard ETF. The natural gas pipeline giant has paid dividends for 52 straight years. While it hasn't raised its payment every year, Williams has been growing the dividend at a mid-single-digit rate in recent years. Its payout currently yields 3.4%.
The pipeline company is investing heavily to support growing gas demand. It's spending over $4 billion on growth initiatives this year, including organic capital projects and a $1.9 billion investment in the development of a pipeline and related LNG facility. The company now has projects underway that should come online through the end of the decade, including three power innovation projects to support data centers. These growth projects should give Williams ample fuel to continue increasing its high-yielding dividend.
Phillips 66
Phillips 66 (NYSE: PSX) has a 0.3% allocation in this high-yield dividend fund. The refining and midstream giant has increased its payment every year since its formation in 2012, when ConocoPhillips spun off the company to its shareholders. It has grown its payout, which currently yields 3.4%, at an impressive 15% compound annual rate during that time frame.
The company has several expansion projects underway. Phillips 66 expects to spend $1.3 billion on growth capital projects in 2026, including building the Iron Mesa gas processing plant (first quarter 2027 in-service date) and the Coastal Bend NGL pipeline expansion (fourth quarter 2026 expected completion). Additionally, its chemicals joint venture with Chevron is building world-scale petrochemical facilities on the U.S. Gulf Coast (2026) and Qatar (early 2027). These investments will grow its cash flows in the coming years to support dividend increases. Phillips 66 has also proposed building a new NGL fractionator and the large-scale Western Gateway Pipeline with a partner, which could give it even more fuel to grow the dividend in the future.
Excellent energy dividend stocks
ExxonMobil, Chevron, ConocoPhillips, Williams, and Phillips 66 pay high-yielding dividends that have risen steadily over the years. That growth appears poised to continue. This combination of yield and growth makes them five of the best high-yielding energy dividend stocks in the Vanguard High Dividend ETF.
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Matt DiLallo has positions in Chevron, ConocoPhillips, and Phillips 66. The Motley Fool has positions in and recommends Chevron and Vanguard Whitehall Funds-Vanguard High Dividend Yield ETF. The Motley Fool recommends ConocoPhillips and Phillips 66. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The 5 Best High-Yield Energy Stocks in the Vanguard High Dividend Yield ETF

Tuesday, December 16, 2025
Markets were mixed today — mostly down but for an uptick on the tech-heavy Nasdaq, partly thanks to good news from Tesla TSLA on its robotaxi until helped the stock rise +3% today, to a new all-time closing high. The Dow, S&P 500 and small-cap Russell 2000 were all down for the day: -0.62%, -0.24% and 0.45%, respectively. The Nasdaq was up +54 points, +0.23%, on the session.
This morning’s jobs report from the U.S. Bureau of Labor Statistics (BLS) bounced back somewhat in November to +64K, but from an October low of -105K not seen since the initial months of the Covid pandemic. Part of this was by design, to remove federal government jobs as per President Trump’s campaign promise to lower costs. But it contributed to a net loss of -41K jobs per month on average. Usually job losses this extreme get investors buzzing about the “r” word…
Retail Sales, S&P PMI Inform Morning Trading
Retail Sales for October — another delayed report due to the government shutdown — came in unched (0.0%) from an expected rise of +0.1%. This follows a downwardly revised +0.1% the prior month. Ex-auto sales, we moved the other way: +0.4% from +0.2% anticipated, and again revised down the previous month — from +0.3% to +0.1%. This is the highest print since the +0.6% from August.
Ex-autos and gas, this number climbed to +0.5%, and the Control figure — which finds its way into other economic reports throughout the month — was an even higher +0.8%, the highest read since June, matching the highest print of the year. Again, we see the American consumer participating to an encouraging degree, once we look past the headline number.
S&P flash Services and Manufacturing PMI for December came in below expectations this morning, with the Services sector tallying 52.9 from an upwardly revised 54.1 the prior month, and Manufacturing dropping to 51.8 from a downwardly revised 52.2 for November. That said, these metrics remain securely above the 50 threshold which determines growth from loss.
A surplus in global crude oil and concerns about economic growth slowing have assisted oil prices in moving to near-five-year lows. The West Texas crude January future traded at $55 per barrel (bbl) today, This marks 10 straight days below the $60/bbl level, with spot prices in the red all around the world except in South Texas for today. It’s a good sign for keeping inflation metrics low, but bad for companies like Phillips 66 PSX, which dropped almost -7% today.
Lennar Home Mixed in Q4 on Lower Home Sales Numbers
Miami-based multi-segment homebuilder Lennar Home LEN posted Q4 earnings after today’s closing bell, missing on the bottom line due to a one-time charge of $156 million to earnings of $1.93 per share. Revenues of $9.37 billion came in ahead of the $9.13 billion in the Zacks consensus. Gross margins of +17% were slightly below market estimates.
New orders were down to +18% year over year, as the “overall market remained challenged” in the quarter, according to co-CEO and Executive Chairman Stuart Miller. The other co-CEO, Jon Jaffe, retires at the end of this year. Expectations for between 17-18K new deliveries are below analyst estimates.
What to Expect from Tomorrow’s Market
Whether market participants will continue to ruminate over whether the economy is weakening due to the soft jobs numbers — or whether they regain hope that CPI figures Thursday morning may increase the likelihood that the Fed may be lowering interest rates at its January meeting — is hard to tell from here. All four major indexes are in the green over the past month of trading, but only the Dow is for the last five trading sessions.
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