Marathon Petroleum (MPC)
Energy · NYSE · US
Fundamentals
Valuation and ratings
Marathon Petroleum trades at $305.85, close to the $330.06 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 44 out of 100, which is little in the way of a moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 18.7 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About Marathon Petroleum
Marathon Petroleum Corporation, together with its subsidiaries, operates as an integrated downstream energy company in the United States. The company operates through three segments: Refining & Marketing; Midstream; and Renewable Diesel. The Refining & Marketing segment refines crude oil and other feedstocks at its refineries in the Gulf Coast, Mid-Continent, and West Coast regions of the United States; and purchases refined products and ethanol for resale and distributes refined products through transportation, storage, distribution, and marketing services. Its refined products include transportation fuels, such as reformulated gasolines and blend-grade gasolines; heavy fuel oil; and asphalt. This segment also manufactures propane and petrochemicals. The company sells refined products to wholesale marketing customers in the United States and internationally, buyers on the spot market, and independent entrepreneurs who operate primarily Marathon branded outlets, as well as through long-term fuel supply contracts to direct dealer locations primarily under the ARCO brand. The Midstream segment gathers, transports, stores, distributes, and markets crude oil and refined products, including renewable diesel and other hydrocarbon-based products through refining logistics assets, pipelines, terminals, towboats, and barges; gathers, processes, and transports natural gas; and transports, fractionates, stores, and markets natural gas liquids. The Renewable Diesel segment processes renewable feedstocks into renewable diesel, markets, and distributes renewable diesel through its Midstream segment and third parties. It sells renewable diesel to wholesale marketing customers, buyers on the spot market, and through long-term supply contracts to direct dealers under the ARCO brand. Marathon Petroleum Corporation was founded in 1887 and is headquartered in Findlay, Ohio.
MPC passes 2 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Smart money ownership
14 of the funds we track reported a position in their latest SEC 13F filing. Largest first:
- Bill Nygren, HARRIS ASSOCIATES L P$1.37B · 0.9% of book
- Two Sigma, TWO SIGMA INVESTMENTS, LP$372.20M · 0.3% of book
- Cliff Asness, AQR CAPITAL MANAGEMENT LLC$105.63M · 0.1% of book
- Israel Englander, MILLENNIUM MANAGEMENT LLC$105.47M · 0.0% of book
- Arrowstreet Capital, ARROWSTREET CAPITAL, LIMITED PARTNERSHIP$100.23M · 0.1% of book
A word of warning on reading these figures: a 13F reports the market value of a holding, so a fund that traded nothing at all still appears to have sold when the price fell. We found 102 companies where the standard reading gives the opposite answer. Only the share count is honest.
Common questions
Is Marathon Petroleum (MPC) undervalued?
Against our discounted cash flow estimate of $330.06, MPC at $305.85 is 8% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
Which funds own MPC?
14 of the institutions we track reported a position in MPC in their most recent SEC 13F filing. A 13F is filed up to 45 days after quarter end, so it tells you what a fund held then, not what it holds now.
What is MPC's P/E ratio?
MPC trades at 18.7 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
The full research page for MPC, with financial statements, ownership detail, peer comparison and alerts, is free inside the app.
Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.