On Friday, Mizuho Securities updated its assessment of Marathon Petroleum Corp (NYSE:MPC), a leading refining company, adjusting the price target slightly upward to $202 from the previous $201. The firm retained a Neutral rating on the stock.
The adjustment followed an analysis of the company's first-quarter performance, which indicated a decline in refining earnings due to increased maintenance activities. These activities led to reduced utilization rates and a narrower Refining & Marketing (R&M) margin, with a capture rate of approximately 94% compared to around 122% seen in the fourth quarter of 2023.
Marathon Petroleum's crude utilization was reported at 83%, which aligns with the guidance and consensus estimates. Mizuho projected the company's refining EBITDA (earnings before interest, taxes, depreciation, and amortization) for the first quarter of 2024 to be $1.82 billion, surpassing the consensus estimate of $1.68 billion. In the Midstream sector, the firm's model anticipates an EBITDA of $1.58 billion, slightly above the consensus of $1.56 billion.
The overall estimate for Marathon Petroleum's EBITDA and earnings per share (EPS) by Mizuho stands at $3.405 billion and $2.43 respectively. These figures compare to the consensus estimates of $2.88 billion for EBITDA and $2.45 for EPS.
The minor increase in the price target reflects the adjustments based on the firm's net asset value (NAV) calculations, which resulted in a new target of $202 per share from the former $201 per share.
InvestingPro Insights
Marathon Petroleum Corp (NYSE:MPC) has shown robust performance metrics as per the latest data from InvestingPro. With a market capitalization of $76.49 billion and an attractive price-to-earnings (P/E) ratio of 8.92, which adjusts to an even more favorable 8.12 when considering the last twelve months as of Q4 2023, the company stands out in the Oil, Gas & Consumable Fuels industry. Moreover, the company's strong revenue of $149.35 billion, despite a decrease in growth, showcases its significant market presence.
InvestingPro Tips highlight the company's aggressive share buyback strategy and high shareholder yield, both indicative of management's confidence in the company's financial health and commitment to returning value to shareholders. Additionally, the fact that 9 analysts have revised their earnings upwards for the upcoming period suggests a positive outlook on the company's future performance. The company has also been able to maintain dividend payments for 14 consecutive years, with a recent dividend yield of 1.52% and a growth of 10.0% in the last twelve months as of Q4 2023.
These financial strengths are further substantiated by Marathon Petroleum's solid returns, with a 70.37% one-year total return and a price currently near its 52-week high, at 98.13% of that peak. Investors seeking to delve deeper into Marathon Petroleum's prospects can find additional insights, including the company's low price volatility and strong return over the last five years, on InvestingPro. With 19 more InvestingPro Tips available, users can gain a comprehensive understanding of the stock's potential. To access these valuable insights, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at https://www.investing.com/pro/MPC.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.