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How Marathon Oil’s Stock Has Reacted to Past Earnings Reports

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Aug. 1 2016, Updated 8:04 a.m. ET

Stock price action

After losing ~84% of its market capitalization between September 2014 and February 2016, Marathon Oil’s (MRO) stock price has finally begun to show signs of new uptrends. In April 2016, MRO’s stock crossed the 200-day moving average for the first time in the past two years, and it’s currently trading ~4% above that average.

Since hitting a bottom in February 2016, Marathon Oil’s stock price has risen by a whopping ~111%.

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Relative performance

Recently, MRO has shown better relative strength than other crude oil (USO) and natural gas (UNG) producers. In the past three months, Marathon Oil’s stock price has decreased by ~1%, as compared to the SPDR S&P Oil and Gas Exploration & Production ETF’s (XOP) ~4% decline during the same period.

Year-to-date performance

In 2016, MRO has been underperforming upstream companies from the S&P Midcap 400 (MDY). So far this year, MRO has risen by ~9%, whereas oil and gas peers Gulfport Energy (GPOR), Denbury Resources (DNR), and SM Energy (SM) have risen by ~18%, ~44%, and ~28%, respectively.

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Stock price performance after past earnings

Marathon Oil reported its 1Q16 earnings after the market closed on May 4, 2016. Excluding the one-time items, Marathon Oil reported a loss of $0.43 per share for 1Q16, which was $0.02 better than the consensus estimate of $0.45 in loss per share. After the earnings release—in a contrarian reaction—MRO’s better-than-expected earnings saw the stock’s price decrease by ~7% during three trading sessions.

MRO reported its 4Q15 earnings after the market closed on February 17, 2016. Excluding one-time items, MRO reported a loss of $0.48 per share for 4Q15, meeting the consensus estimates for a loss of $0.48 per share. After the earnings release, in-line earnings saw Marathon Oil’s stock price decrease by ~9% during the next two sessions.

MRO’s 3Q15 post-earnings reaction was negative, when Marathon Oil’s stock price decreased by ~11% during the next six sessions after beating the consensus earnings estimates. We saw a similar contrarian reaction after the company’s 2Q15 and 1Q15 earnings as well, when Marathon Oil’s stock price fell by ~28% and ~8% during the next three weeks and two weeks, respectively—even after beating consensus earnings estimates by $0.01 and $0.09 per share, respectively.

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