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NYSE:MRO is an undervalued gem with solid fundamentals.

By Mill Chart

Last update: Mar 4, 2024

Our stock screener has spotted MARATHON OIL CORP (NYSE:MRO) as an undervalued stock with solid fundamentals. NYSE:MRO shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

How do we evaluate the Valuation for NYSE:MRO?

To assess a stock's valuation, ChartMill utilizes a Valuation Rating on a scale of 0 to 10. This comprehensive assessment considers various valuation aspects, comparing price to earnings and cash flows, while factoring in profitability and growth. NYSE:MRO has achieved a 7 out of 10:

  • Based on the Price/Earnings ratio of 9.43, the valuation of MRO can be described as reasonable.
  • Compared to an average S&P500 Price/Earnings ratio of 25.86, MRO is valued rather cheaply.
  • MRO is valuated reasonably with a Price/Forward Earnings ratio of 8.10.
  • 71.03% of the companies in the same industry are more expensive than MRO, based on the Price/Forward Earnings ratio.
  • The average S&P500 Price/Forward Earnings ratio is at 21.87. MRO is valued rather cheaply when compared to this.
  • Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of MRO indicates a somewhat cheap valuation: MRO is cheaper than 68.69% of the companies listed in the same industry.
  • Based on the Price/Free Cash Flow ratio, MRO is valued a bit cheaper than 74.77% of the companies in the same industry.
  • MRO's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
  • MRO has a very decent profitability rating, which may justify a higher PE ratio.

Evaluating Profitability: NYSE:MRO

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NYSE:MRO, the assigned 6 is noteworthy for profitability:

  • The Return On Invested Capital of MRO (12.27%) is better than 61.22% of its industry peers.
  • In the last couple of years the Profit Margin of MRO has grown nicely.
  • MRO has a Operating Margin of 33.43%. This is in the better half of the industry: MRO outperforms 60.28% of its industry peers.
  • In the last couple of years the Operating Margin of MRO has grown nicely.
  • The Gross Margin of MRO (87.60%) is better than 91.59% of its industry peers.

Understanding NYSE:MRO's Health

ChartMill employs a unique Health Rating system for all stocks. This rating, ranging from 0 to 10, is determined by analyzing various liquidity and solvency ratios. For NYSE:MRO, the assigned 5 for health provides valuable insights:

  • MRO has a better Altman-Z score (2.45) than 65.89% of its industry peers.
  • MRO has a debt to FCF ratio of 2.65. This is a good value and a sign of high solvency as MRO would need 2.65 years to pay back of all of its debts.
  • With a decent Debt to FCF ratio value of 2.65, MRO is doing good in the industry, outperforming 67.29% of the companies in the same industry.
  • MRO has a Debt/Equity ratio of 0.34. This is a healthy value indicating a solid balance between debt and equity.

Analyzing Growth Metrics

ChartMill assigns a Growth Rating to each stock, ranging from 0 to 10. This rating is determined by analyzing different growth elements, including EPS and revenue growth, spanning both historical and future figures. In the case of NYSE:MRO, the assigned 4 reflects its growth potential:

  • Measured over the past years, MRO shows a very strong growth in Earnings Per Share. The EPS has been growing by 29.38% on average per year.
  • The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

Our Decent Value screener lists more Decent Value stocks and is updated daily.

For an up to date full fundamental analysis you can check the fundamental report of MRO

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.

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MARATHON OIL CORP

NYSE:MRO (5/29/2024, 7:18:41 PM)

Premarket: 28.74 +0.06 (+0.21%)

28.68

+2.23 (+8.43%)

MRO News

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