Covered, compounding. A 1.88% yield on a 29.35% payout is comfortably covered, and the rate keeps rising — $1.33 a quarter after the October 2026 raise, the 14th consecutive annual increase. Refining margins swing, but the payout has grown through both strong and weak cycles.
Key risk: Refining margins — crack spreads drive PSX's earnings, and they swing hard with crude and product markets. The payout has grown through weak cycles before, but a long margin downturn is the test.
Changes if: The payout pushes well past 29.35% on a refining-margin downturn, or the 14-year raise streak breaks.
- ✓Payout-coverage check: 29.35% trailing payout ratio — comfortably covered.
- ✓Yield check: 1.88% indicated — $1.33/qtr × 4 at the $283.18 close on Oct. 23, 2026. Real, earned yield.
- ✓Dividend growth check: Raised to $1.33 in October 2026 from $1.27 — 14 consecutive years of increases.
What this grade doesn't say: It screens the dividend only — covered, real, compounding. It says nothing about valuation or price: a well-covered payer can still be overpriced, and its price can still fall.