NYSE:MPC, an undervalued stock with good fundamentals.

Our stock screening tool has pinpointed MARATHON PETROLEUM CORP (NYSE:MPC) as an undervalued stock. NYSE:MPC maintains a solid financial footing. Furthermore, it remains attractively priced. Let's delve into the specifics below.

Assessing Valuation Metrics for NYSE:MPC

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NYSE:MPC was assigned a score of 7 for valuation:

• A Price/Earnings ratio of 5.65 indicates a rather cheap valuation of MPC.
• MPC's Price/Earnings ratio is a bit cheaper when compared to the industry. MPC is cheaper than 77.42% of the companies in the same industry.
• When comparing the Price/Earnings ratio of MPC to the average of the S&P500 Index (24.28), we can say MPC is valued rather cheaply.
• The Price/Forward Earnings ratio is 8.77, which indicates a very decent valuation of MPC.
• Compared to the rest of the industry, the Price/Forward Earnings ratio of MPC indicates a somewhat cheap valuation: MPC is cheaper than 63.13% of the companies listed in the same industry.
• MPC's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 19.41.
• Based on the Enterprise Value to EBITDA ratio, MPC is valued cheaper than 80.18% of the companies in the same industry.
• Compared to the rest of the industry, the Price/Free Cash Flow ratio of MPC indicates a rather cheap valuation: MPC is cheaper than 88.48% of the companies listed in the same industry.
• The decent profitability rating of MPC may justify a higher PE ratio.

Looking at the Profitability

ChartMill's Profitability Rating offers a unique perspective on stock analysis, providing scores from 0 to 10. These ratings consider a wide range of profitability metrics and margins, both in comparison to industry peers and on their own merits. For NYSE:MPC, the assigned 6 is a significant indicator of profitability:

• Looking at the Return On Assets, with a value of 12.83%, MPC is in the better half of the industry, outperforming 66.82% of the companies in the same industry.
• MPC has a Return On Equity of 44.63%. This is amongst the best in the industry. MPC outperforms 86.18% of its industry peers.
• The Return On Invested Capital of MPC (20.70%) is better than 80.18% of its industry peers.
• In the last couple of years the Profit Margin of MPC has grown nicely.
• MPC's Operating Margin has improved in the last couple of years.
• In the last couple of years the Gross Margin of MPC has grown nicely.

Understanding NYSE:MPC's Health

ChartMill employs its own Health Rating for stock assessment. This rating, ranging from 0 to 10, is calculated by examining various liquidity and solvency ratios. In the case of NYSE:MPC, the assigned 7 reflects its health status:

• MPC has an Altman-Z score of 3.56. This indicates that MPC is financially healthy and has little risk of bankruptcy at the moment.
• The Altman-Z score of MPC (3.56) is better than 77.88% of its industry peers.
• MPC has a debt to FCF ratio of 1.78. This is a very positive value and a sign of high solvency as it would only need 1.78 years to pay back of all of its debts.
• With a decent Debt to FCF ratio value of 1.78, MPC is doing good in the industry, outperforming 74.19% of the companies in the same industry.
• Even though the debt/equity ratio score it not favorable for MPC, it has very limited outstanding debt, so we won't put too much weight on the DE evaluation.
• The Current ratio of MPC (1.67) is better than 69.12% of its industry peers.
• MPC has a Quick ratio of 1.20. This is in the better half of the industry: MPC outperforms 62.21% of its industry peers.

Analyzing Growth Metrics

ChartMill employs its own Growth Rating system for all stocks. This score, ranging from 0 to 10, is derived by evaluating different growth factors, such as EPS and revenue growth, taking into account both past performance and future projections. NYSE:MPC has earned a 4 for growth:

• The Earnings Per Share has grown by an impressive 23.53% over the past year.
• Measured over the past years, MPC shows a very strong growth in Earnings Per Share. The EPS has been growing by 46.84% on average per year.
• MPC shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 18.88% yearly.

More Decent Value stocks can be found in our Decent Value screener.

Check the latest full fundamental report of MPC for a complete fundamental analysis.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.