Marathon Petroleum Corp
The MPLX crude oil pipeline system
MPLX crude pipelines are connected to supply hubs, and transport crude oil to Marathon Petroleum Corporation’s, or MPC’s, refineries and third parties.
Overview of US Gulf Coast 3:2:1 Crack Spread
Crack spreads usually fall when crude oil prices (USO) increase by more than product prices, or when product prices fall more than crude oil prices.
HollyFrontier’s Stock: Trading Below Moving Averages
Refining companies’ stock performance was affected by the abolition of the crude oil export ban in the United States.
Why Phillips 66 Commands Premium Valuations
Phillips 66 (PSX) is trading at a forward PE (price-to-earnings) ratio of 15.1x, which is above its peer average of 14.5x.
HollyFrontier Stock Has Recovered 5.5% in 2019
HollyFrontier (HFC) stock has risen 5.5% since January 2. The stock has risen less than its peers Marathon Petroleum (MPC) and Valero (VLO).
Andeavor’s Decent Growth Expectations for the Second Quarter
We began this series by ranking the growth in refiners’ second-quarter earnings. In the preceding two parts, we looked at the two highest probable growth achievers for Q2 2018.
How Valero’s Institutional Holdings Shape up Pre-3Q16 Earnings
Valero Energy’s institutional holdings currently stand at ~86% and have fallen since the end of February 2016, when its institutional holdings stood at 98%.
HFC and PSX: Which Company Could Post the Most Gains?
After HollyFrontier’s earnings, RBC lowered its target price on the stock from $68 to $66.
US Refinery Inputs: Another Cause for Crude Oil Inventory Build
The four-week average refinery input level of 15.7 MMbpd for the week ended October 9 was 0.3% higher than last year, which is relatively flat.
MPC-ANDV Merger Could Create Massive Refining Capabilities
The merged entity would have 16 refineries with around 3 million barrels per day (or MMbpd) of capacity spread across the US.
What Does Phillips 66’s Cash Flow Analysis Suggest?
Phillips 66’s cash balance fell 52% to ~$2.3 billion in 3Q16 due to cash inflow from operations, offset by weak cash outflow from financing and investing.
Why analysts were surprised by distillate inventories last week
It’s expected distillate production will grow by the end of 2014. Refineries have built new facilities to produce more distillates than gasoline in anticipation of strong global demand growth.
Refiners’ 4Q17 Estimates: Ranking MPC, VLO, PSX, ANDV on Earnings
In this series, we’ll be sorting refining stocks in terms of earnings expectations for 4Q17. If we rank them on their likely YoY growth in EPS, then Andeavor (ANDV) occupies the top slot.
Will Marathon Petroleum’s Q1 Earnings Rise?
Marathon Petroleum (MPC) is scheduled to report its first-quarter results on May 8.
Valero’s 4Q15 Estimates Suggest Two Big Words: Under Pressure
In 4Q15, according to Wall Street analyst estimates, Valero is expected to post EPS of $1.40, which would be 23% lower than its 4Q14 adjusted EPS.
Analyzing HollyFrontier’s Refining Margin in 2018
HollyFrontier’s refining segment is critical for its overall earnings. The refining segment’s adjusted EBITDA rose 127% to $1.7 billion in 2018.
How Did Tesoro’s Refining Margin Trend in 3Q16?
Tesoro (TSO) noted a contraction in its GRM (gross refining margin) by $10.4 per barrel YoY (year-over-year) to $9.1 per barrel in 3Q16.
Valero’s Liquidity: Does It Justify High Shareholder Returns?
Valero’s liquidity In 1H17, Valero Energy (VLO) generated $2785 million in cash from operations. The company had cash outflows of $880 million in the form of capital expenditure and deferred turnaround and catalyst costs and $627 million in the form of dividends. Valero’s liquidity surplus Valero’s cash outflows amounted to around $1507 million in 1H17, […]
How Is Marathon Petroleum’s Leverage Trending?
Marathon Petroleum’s solvency ratios are higher than the industry average, which is not a comfortable situation.
Breaking down Phillips 66’s Capital Expenditure
With refining modernization projects and midstream and chemical expansion projects, Phillips 66 is set to create a growth-oriented diversified earnings model.
Marathon Petroleum’s Earnings Mix by Segment
Marathon Petroleum’s (MPC) operating income rose 51% yearly to $440 million in the first quarter. The rise in midstream earnings mainly led to the rise in operating income.
Distillate inventories continued to decline
Distillate demand and stock levels drive crude demand and crude prices. As a result, energy investors watch distillate inventories closely.
Where Analysts’ Ratings Stand for Tesoro after Its 3Q16 Earnings
The highest and lowest 12-month price targets for Tesoro’s stock stand at $120 and $84, respectively.
Valero Energy’s Analyst Recommendations: No “Sell” Ratings
Barclays, Goldman Sachs, Credit Suisse, and Wolfe Research have positive recommendations for the stock. They gave price targets equal to $80 per share or above.
Refining Stocks and WTI: A Correlation Analysis
Let’s analyze the correlations between oil prices and the top four American refiners: Marathon Petroleum (MPC), Valero Energy (VLO), Tesoro (TSO), and Phillips 66 (PSX).
Trend Watch: Tesoro’s Refining Margins in 1Q17
In 1Q17 to date, Tesoro’s refining index values have shown a mixed trend compared to 4Q16, quarter-over-quarter.
HollyFrontier: Which Institutions Bought or Sold the Stock?
Dimensional Fund Advisers, AQR Capital Management, and Goldman Sachs increased their holdings in HollyFrontier stock in the first quarter.
US Crude Oil’s Small Gain: Which Energy Stocks Outperformed Last Week?
Upstream stock California Resources (CRC) rose the most among the companies on our list of energy stocks between October 13 and October 20, 2017.
Tesoro’s Big Bet on Building Crude-by-Rail Infrastructure
An important part of Tesoro’s business, crude-by-rail allows refiners to cover maximum accessibility and to gain from price differentials.
Phillips 66: 2Q17 Earnings Beat Estimates, Refining Earnings Rose
In 2Q17, Phillips 66’s revenues missed Wall Street analysts’ estimates by 1%. However, its 2Q17 adjusted EPS of $1.09 surpassed estimates of $1.01.
Did MPC, ANDV, VLO, and PSX’s Debt Positions Improve in Q1 2018?
In the first quarter, Valero observed the highest rise in its net debt. VLO’s net debt rose 42.0% sequentially to $4.3 billion.
Why Does Marathon Petroleum Have Mixed Valuations?
Currently, Marathon Petroleum (MPC) trades at a forward PE ratio of 9.0x, which is below the peer average of 9.9x.
Distribution Yield Might Fall for MarkWest Unitholders
Currently, MarkWest Energy and MPLX trade at distribution yields of 5.33% and 2.95%, respectively—compared to pre-merger announcement yields.
Waiting for the Numbers: Valero’s 4Q15 Earnings and Refining Margin Trend
In 3Q15, Valero noted a rise in its gross refining margin by $2.6 per barrel to $14.4 per barrel, compared to what we saw in 3Q14.
Who among MPC, VLO, HFC, and PSX Has the Highest Refining Margin?
In this article, we’ll compare the gross refining margins of leading American downstream companies.
Why Andeavor Has so Many ‘Buy’ Ratings among US Refiners
Of the 17 analysts covering Andeavor (ANDV), 15 (88%) have rated the stock a “buy” so far in August 2017. Two analysts have rated ANDV a “hold.”
Marathon Petroleum’s Target Prices ahead of Q1 Earnings
Marathon Petroleum has been covered by a total of 19 analysts. Fifteen (79%) have assigned “buy” or “strong buy” ratings.
Has Correlation of Refining Stocks with WTI Surged in the Past Month?
The correlation coefficient of VLO and WTI has risen to 0.51 in the past one-month period compared to 0.07 in the past one-year period.
Delek Ranks Fourth: Have Analysts Started Disliking It?
In this article, we’ll look at the fourth refiner on our list: Delek US Holdings (DK). Delek has 56% “buy” ratings from analysts.
How Are Analysts Rating MPC after Its 3Q16 Earnings?
The analyst survey shows that nine out of the 12 companies surveyed rated Marathon Petroleum (MPC) as a “buy,” “overweight,” or “outperform.”
Marathon Petroleum’s Returns: Will Dividends Rise?
Marathon Petroleum’s (MPC) dividend payments have been growing steadily for the past few years.
Do Marathon Petroleum’s Valuations Stand above Peer Averages?
Currently, MPC trades at a forward PE (price-to-earnings) ratio of 14.8x, above its peer average of 13.8x.
Your Segmental Analysis of Marathon Petroleum’s 4Q15 Results
On a sequential basis, Marathon’s operating income fell by 78%. All the segments reported declines in income in 4Q15 over 3Q15.
Update: Distillate inventory movement
Inventories provide a useful snapshot of distillate demand and supply trends, particularly near and during the winter months.
Phillips 66’s Cash Flow: Rising Shareholder Returns and Capex
From 3Q14 to 3Q15, PSX maintained average quarterly cash flow from operations at $1.1 billion. The company has continued its focus on preserving growth.
Why independent refiners did better during the energy decline
Refiners’ profits are driven by the difference in the prices of refined products—like gasoline and diesel—and the cost of crude oil. Refining companies didn’t lose as much as their upstream peers.
Where Phillips 66’s Moving Averages Stand
In 2Q17, Phillips 66 (PSX) rose, likely due to its 1Q17 numbers.
Why gasoline inventories didn’t have much effect on crude prices
Last week, gasoline inventories increased by 1 MMbbls (million barrels) to 204.6 MMbbls.
Phillips 66: Refining Yields in the Fourth Quarter
Phillips 66’s (PSX) refining operations yielded 45% gasoline and 39% distillates in the fourth quarter.
Marathon Petroleum: Analysts’ Recommendations
Since Marathon Petroleum’s third-quarter earnings, the stock has been rated by 17 analysts. All of the analysts assigned “buy” or “strong buy” ratings.
Will Tesoro’s Stock Uptrend Last after 4Q15 Earnings?
Tesoro Corporation’s (TSO) stock was on an uptrend in 2015, fueled by healthy refining margins. TSO rose 21% in the trailing 12 months up to January 20, 2016.
Why Distillate Inventories Declined for the Week Ending January 15
US distillate fuel inventories fell by ~1.1 MMbbls (million barrels) to settle at 164.5 MMbbls for the week ending January 15, 2016.
How Did Valero’s Refining Margins Shape Up in Its Latest Quarter?
Valero’s total refining capacity is 3.0 MMbpd (million barrels per day), of which 1.7 MMbpd is located in the US Gulf Coast.
Marathon Petroleum’s Cash Flow Position
In the first half of 2018, Marathon Petroleum (MPC) had $2.249 billion in cash from operations. The company had cash outflows of $1.466 billion.
MPC, ANDV, VLO, PSX: Why Refining Stocks Are Underperforming SPY
In this series, we’ll perform a cross-sectional analysis of refining stocks. We’ll examine their moving averages and eight-day price forecasts based on implied volatility, and compare their leverage, liquidity, capex, and refining margins.
How Tesoro’s Refining Margin Shaped Up in 1Q17
Tesoro (TSO) noted a rise in its gross refining margin by $1.90 per barrel year-over-year to $9.40 per barrel in 1Q17.
PSX’s 50-Day Average Falls below Its 200-Day Average in Q4
Now let’s look at Phillips 66’s moving averages in the current quarter.
Valero’s Stock Performance: Gained 20% from February 2016
Valero Energy (VLO) has witnessed a rise in its stock price since February 2016. In this series, we will provide you with an update on the company’s operations, financials, and market performance.
How HollyFrontier’s Beta Compares to Peers
HollyFrontier’s beta stands at 2.2 for the past 90 days.
Behind Delek US Holdings’ Scant ‘Buy’ Ratings
Four (27%) of the 15 analysts covering DK have rated it a “buy” so far in August 2017.
Why Did Gasoline Inventories Fall at the End of June?
Gasoline production increased from 9.93 million barrels per day (or MMbpd) in the week of June 19 to 10.04 MMbpd in the week ended June 26.
How Does Valero’s PEG Ratio Compare to Peers?
Valero’s PEG ratio stands at 0.50, below the peer average of 0.60.
Why MPC Is Trading at Double Its Historical Average
Marathon Petroleum traded at an average PE (price-to-earnings ratio) of 12.5x from 1Q15 to 1Q17. MPC’s PE ratio rose to 22.9x in 1Q17 from 11.7x in 1Q15 due to a rise in its stock price.
Marathon Petroleum Outperformed SPY, Stock Rose 17%
Since the beginning of the third quarter on July 2, Marathon Petroleum (MPC) stock has risen 17%. The stock outperformed the SPDR S&P 500 ETF (SPY).
Heating Oil Prices Fall by ~11 Cents per Gallon
Last week, as of March 23, residential heating oil prices averaged ~$2.93 per gallon—~11 cents per gallon lower than the week before.
Why the Chemicals and Midstream segments outperformed in 2Q14
Phillips 66’s net income decreased ~10% to $863 million in 2Q14—from $958 million in 2Q13. Despite the decrease, the Midstream and Chemicals segments’ share in the net income increased to 11% and 33% in 2Q14.
Reading the Top Institutional Holders in MPLX
Among the top institutional holders, 9.33 million positions were added in 3Q17, which indicates a bullish sentiment toward MPLX.
Third Avenue Focused Credit Fund Liquidated: Concerns for Others?
On December 10, 2015, Third Avenue Management announced that redemptions were barred from the Third Avenue Focused Credit Fund (TFCVX) (TFCIX).
US Gulf Coast 3:2:1 Crack Spread Falls in Week Ended July 13
A wider crack spread increases the profit margins of refiners such as Valero Energy (VLO), Phillips 66 (PSX), Marathon Petroleum (MPC), and Tesoro (TSO).
Valero’s 1Q17 Earnings Beat Estimates, Refining Margin Expands
Valero Energy (VLO) posted its 1Q17 results on April 25, 2017. Before we proceed with an earnings review, let’s quickly examine VLO’s 1Q17 performance versus its estimates.
Analyzing the US Natural Gas Production Trend
PointLogic estimates that US dry natural gas production increased 0.6% to 80.1 Bcf (billion cubic feet) per day on April 19–25.
What Should Fixed Income Investors Do in Present Times?
What should fixed income investors do today? Generally, widening spreads provide a buying opportunity for investors, because spreads widen when yield of a security rises.
API Reports a Drop in US Crude Oil Inventories
The API reported that US crude oil inventories decreased by 1.85 MMbbls (million barrels) on April 27–May 4.
Average US Households Expected to Spend $710 Less on Heating Oil
Like gasoline and distillates, heating oil consumption or demand trends matter to refineries.
4Q16 Pre-Earnings Release: Valero’s Stock Performance
Refining sector stocks usually perform in line with refining margins and cracks. Since February 2016, refining stocks have been putting up volatile performances.
How Analysts Rate Pre-Earnings for PSX, MPC, HFC, and VLO
Marathon Petroleum is growing with its capex and acquisitions, including the latest acquisition of Andeavor.
What Tesoro’s Refining Index for 3Q16 Suggests
In 3Q16, Tesoro’s (TSO) refining index values, which are regional crack indicators in the areas where TSO operates, have fallen compared to 3Q15.
MPC, TSO, VLO, PSX: Which Refining Stock Is Trading at a Premium?
Now, let’s look at the forward valuations of Marathon Petroleum (MPC), Tesoro (TSO), Valero Energy (VLO), and Phillips 66 (PSX).
MPC-ANDV Merger Would Create Premium Midstream Assets
The merger of MPC-ANDV would create a huge midstream segment with two separate MLPs.
Marathon Petroleum’s Debt Is Lower than Industry Averages
Marathon Petroluem’s net debt-to-EBITDA ratio stood at 1.9x in 4Q16. It’s lower than the average industry ratio of 2.8x.
Marathon Petroleum’s Valuations Were Mixed
Currently, Marathon Petroleum (MPC) trades at a forward PE ratio of 12.6x—above its peer average of 11.9x.
Refining Stocks and Oil Prices: Understanding the Correlation Coefficient
The correlation coefficient of Phillips 66 (PSX) and WTI stands highest among refiners at 0.42.
Important update on heating oil prices
As of January 5, residential heating oil prices averaged ~$2.97 per gallon, ~$0.08 lower than last week and $1.05 lower than the same week last year.
MPC, TSO, VLO, PSX: Ranking Their Refining Yields in 4Q17
In 4Q17, Andeavor’s (ANDV) gasoline production stood at 53.0% of its total refined products produced.
Crude Prices Fell Again Due to Long-Term Oversupply Concerns
NYMEX-traded WTI crude oil futures for March delivery fell and closed at $29.64 per barrel on February 19. Oil prices fell due to long-term oversupply concerns.
Why Has Marathon Petroleum Stock Underperformed SPY in 1Q18?
Since January 2, 2018, Marathon Petroleum stock has risen 0.7%, underperforming the SPDR S&P 500 ETF (SPY), the overall market indicator.
MPLX Stock Looks Attractive
MPLX’s (MPLX) median target price is $41.4, which implies an upside potential of more than 25% from its current price of $33.0.
Comparing Refiners’ Cash Flow: Valero Tops the List
Valero’s (VSO) cash flow excess as a percentage of CFO stands at 50%. Comparatively, Marathon Petroleum’s (MPC) excess stands at 11%.
A Look at Phillips 66’s Leverage Curve Trend
Phillips 66’s (PSX) leverage ratio, its net debt-to-EBITDA, stood at 3.9x in 1Q17, which was higher than the average industry ratio of 2.2x.
Gasoline Inventories Could Push Oil Prices to Multiyear Highs
The API reported that US gasoline inventories fell by ~3.1 MMbbls (million barrels) on June 22–29.
Why MPC and PSX Trade at a Premium, ANDV and VLO at a Discount
In the previous part of this series, we discussed refining stocks’ dividend yield trends. Now, we’ll look at the forward valuations for Marathon Petroleum (MPC), Andeavor (ANDV), Valero Energy (VLO), and Phillips 66 (PSX).
Why Most Analysts Are Calling Marathon Petroleum a ‘Buy’
Marathon Petroleum (MPC) has been rated by 19 Wall Street analysts. Seventeen analysts (or 89%) have rated it as a “buy” so far in May 2017.
Comparing MPC’s, TSO’s, VLO’s, and PSX’s Valuation
Average valuation multiples Earlier, we discussed refining stocks’ performance in 1Q17 and compared their dividend yields. In this part, we’ll look at Marathon Petroleum’s (MPC), Tesoro’s (TSO), Valero Energy’s (VLO), and Phillips 66’s (PSX) forward valuation. The average forward EV-to-EBITDA (enterprise value to earnings before interest, tax, depreciation, and amortization) multiples and average forward PE […]
Heating oil prices prices rise by about 11 cents per gallon
Heating oil prices are linked to crude prices. As crude prices began to fall late last year, so did heating oil prices. However, last week, crude prices had been rising. This move was mirrored by heating oil prices, as the graph above shows.
How Is Marathon Petroleum Stock Performing in 4Q17?
Since October 2, 2017, Marathon Petroleum (MPC) stock has risen 15.7%, outperforming the SPDR S&P 500 ETF (SPY). SPY has risen 5.3% in the same period.
EPD and MPLX Have High Earnings Growth
Kinder Morgan’s adjusted EBITDA grew 7% YoY in the second quarter. The EBITDA grew at an average rate of 4% over the last six quarters.
Diesel Prices Remain on Downward Trajectory in Week of June 22
According to the EIA’s Short-Term Energy Outlook released on June 9, diesel fuel retail prices will average $2.88 per gallon in 2015, and then rise to $3.04 per gallon in 2016.
Why Phillips 66 Stock Is Trading at a Premium
Phillips 66 (PSX) is trading at a forward price-to-earnings ratio of 13.0x, which is above the peer average of 11.9x.
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 […]
MPLX Had Higher Volumes and Acquired Assets
MPLX’s (MPLX) Logistics and Storage segment’s adjusted EBITDA nearly tripled from $184 million in Q2 2017 to $526 million in Q2 2018.