UPDATE: Oppenheimer Initiates Phillips 66 with Outperform, $42 PT Post Spin from ConocoPhillips

Oppenheimer initiated its coverage on Phillips 66 PSX with an Outperform rating and a price target of $42. Oppenheimer commented, "PSX, which was spun off on May 1 from COP, is an integrated downstream company with a leading position in all of its three business segments: Refining & Marketing, Gas Gathering & Processing, and Petrochemicals. PSX's business strategy is to de-emphasize refining, while aggressively expanding its two other businesses, maximizing return on capital by investing in profitable growth and controlling costs. The company intends to grow its cash dividend and repurchase its shares, while maintaining strong financial flexibility. We believe this unique asset mix, large scale and balanced operations give PSX a competitive advantage throughout the business cycle." Phillips 66 closed at $34.94 on Friday.