Findlay, Ohio-based Marathon Petroleum Corporation (MPC) operates as an integrated downstream energy company. With a market cap of $45.7 billion, Marathon Petroleum operates through Refining & Marketing and Midstream segments. The oil refining & marketing giant is gearing up to announce its fourth-quarter results before the market opens on Tuesday, Feb. 4.
Ahead of the event analysts expect Marathon Petroleum to report a non-GAAP profit of $0.26 per share, down a massive 93.5% from $3.98 per share reported in the year-ago quarter. However, the company has a robust earnings surprise history. It has surpassed Wall Street’s bottom-line estimates in each of the past four quarters. While its adjusted EPS for the last reported quarter tanked 77% year-over-year to $1.87, it surpassed analysts’ estimates by a significant 92.8%.
For the full fiscal 2024, MPC is expected to deliver an adjusted EPS of $9.38, down 60.3% from $23.63 in fiscal 2023. While in fiscal 2025, its earnings are expected to decline 4.3% year-over-year to $8.98 per share.
MPC stock has dropped 6.9% over the past 52 weeks, substantially underperforming the S&P 500 Index’s ($SPX) 21.8% gains and the Energy Select Sector SPDR Fund’s (XLE) 8.4% returns during the same time frame.
The oil refining and marketing industry is grappling with a challenging phase due to narrowing market crack spreads, affecting margins for oil refiners across the board. As a result, Marathon Petroleum’s Q3 total revenues and other income plunged 14.9% year-over-year to $35.4 billion, along with a massive 71.6% year-over-year drop in operating income to $1.3 billion.
However, Marathon Petroleum’s stock prices surged 3.2% after the release of its Q3 results on Nov. 5 as the company’s topline exceeded Wall Street’s estimates by more than 12%, accompanied by a significant positive earnings surprise.
Meanwhile, despite the challenging macro environment, MPC repurchased $3 billion worth of common stock during the quarter. It also announced an extra $5 billion share repurchase authorization and a 10% increase in the quarterly dividend, demonstrating its commitment to shareholders.
The consensus opinion on MPC stock is moderately bullish, with an overall “Moderate Buy” rating. Out of the 18 analysts covering the stock, 12 recommend “Strong Buy” and six suggest a “Hold” rating. Its mean price target of $174.67 represents a 22.8% premium to current price levels.
