A Look at Refining Stocks' Post-1Q17 Performance

1 2 3 4 5 6 7 8 9 10 11 12
Part 10
A Look at Refining Stocks' Post-1Q17 Performance PART 10 OF 12

How Refining Stocks’ Historical Valuation Compares

Refining stocks’ valuation

In this part, we’ll compare refining stocks’ EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) ratios with their three-year averages. Marathon Petroleum (MPC), Valero Energy (VLO), Phillips 66 (PSX), and Tesoro (TSO) are trading higher than their historical valuation. MPC was trading at a 10.3x EV-to-EBITDA ratio in 1Q17, compared with its historical average of 6.5x.

How Refining Stocks&#8217; Historical Valuation Compares

Interested in VLO? Don't miss the next report.

Receive e-mail alerts for new research on VLO

Success! You are now receiving e-mail alerts for new research. A temporary password for your new Market Realist account has been sent to your e-mail address.

Success! has been added to your Ticker Alerts.

Success! has been added to your Ticker Alerts. Subscriptions can be managed in your user profile.

Why the higher valuation?

MPC, VLO, PSX, and TSO are trading at a higher valuation than their historical average because investors are holding onto their stock despite volatile performance. MPC is aiming to unlock shareholder value, PSX is ardently working towards creating a diversified earnings model, and TSO is following an inorganic growth path with its ongoing acquisition of Western Refining (WNR). For exposure to small-cap stocks, you could consider the iShares Russell 2000 Value ETF (IWN), which has a ~5% exposure to energy sector stocks, including WNR.


Please select a profession that best describes you: