On Wednesday, Dividend Growth Newsletter portfolio holding Phillips 66 (click ticker for report: ) declared its quarterly dividend of $0.25, a level that’s 25% higher than its previous dividend of $0.20 per share. The firm now yields approximately 2.2% at current levels.
Though shares trade near our fair value estimate, we think the company still has some upside from current levels. Fundamentals in the refinery sector continue to improve, and we’re big fans of the firm’s retail operations. Additionally, management remains firmly committed to returning cash to shareholders annually in increasing amounts, so we think the dividend will continue to grow going forward. We hold the company in the portfolio of our Dividend Growth Newsletter.