Shares of Phillips 66 (PSX -0.24%) jumped 15.6% in October, according to data provided by S&P Global Market Intelligence. Driving the refining stock's big month was a refueled share repurchase program and its third-quarter report.
Phillips 66 approved a new $3 billion share repurchase program last month. That will boost its total authorization to $15 billion since it started repurchasing shares in 2012. Its previous repurchases have already reduced its share count by 32%. Add in dividends, and the refiner has returned more than $24 billion to its investors since 2012.
Phillips 66 also reported excellent third-quarter results last month. It posted $1.4 billion, or $3.11 per share, of adjusted earnings, which blew past the analysts' consensus estimate by $0.49 per share. Meanwhile, cash flow was even stronger at $1.7 billion. Powering the company's results was its marketing and specialties segment, where adjusted pre-tax income jumped 41%. That was mainly due to the strength of its export business, where volumes rose 16%.
Phillips 66 continues to generate lots of cash. It aims to reinvest 60% of that money to drive growth while returning the rest to shareholders via dividends and its repurchase program. This formula has been wildly successful over the years as the refiner's total return has more than doubled that of the S&P 500. With the company sticking to that winning plan, it should have the fuel to keep outperforming.