MPC

Marathon Petroleum Corporation

Energy


Presented:01/29/2016
Price:$41.79
Cap:$22.48B
Current Price:$157.02
Cap:$52.55B

Presented

Date01/29/2016
Price$41.79
Market Cap$22.48B
Ent Value$30.22B
P/E Ratio6.61x
Book Value$22.99
Div Yield3.06%
Shares O/S538.00M
Ave Daily Vol5,541,538
Short Int1.42%

Current

Price$157.02
Market Cap$52.55B
Marathon Petroleum Corp. is an independent petroleum product refiners, marketers and transporters in the United States. The company operates through three segments: Refining & Marketing, Speedway and Pipeline Transportation. The Refining & Marketing segment refines crude oil and other feedstocks at its refineries in the Gulf Coast and Midwest regions of the United States, purchases ethanol and refined products for resale and distributes refined products through various means, including barges, terminals and trucks that the company owns or operates. The Speedway segment sells transportation fuels and convenience products in the retail market in the Midwest, primarily through Speedway convenience stores. The Pipeline Transportation segment transports crude oil and other feedstocks to refineries and other locations, delivers refined products to wholesale and retail market areas and includes the aggregated operations of MPLX LP and the company's retained pipeline assets and investments. Marathon Petroleum was founded on June 30, 2011 and is headquartered in Findlay, OH.

Publicly traded companies mentioned herein: Marathon Petroleum Corporation (MPC), MPLX LP (MPLX), Phillips 66 (PSX)

Highlights

The presenter is currently short shares of Marathon Petroleum (MPC), and at ~$40 he sees the potential for 50% downside. Its core refining business faces “severe” headwinds over the next 2 - 3 quarters as feedstock costs are rising, and MPC is likely going to have to redirect cash flow to support its MLP (MPLX) following the acquisition of MarkWest. This could place the dividend and buyback program at risk, in his opinion. If his assessment of the situation proves to be accurate, MPC stock could trade down towards $20 (his fair value estimate) over the course of 2016.

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