Marathon Oil Corp (MRO) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:MRO - US5658491064 - Common Stock
28.55 USD
-0.37 (-1.28%)
28.5798 USD
+0.03 (+0.1%)
MRO gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 207 industry peers in the Oil, Gas & Consumable Fuels industry. Both the profitability and the financial health of MRO get a neutral evaluation. Nothing too spectacular is happening here. MRO is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
- MRO had positive earnings in the past year.
- MRO had a positive operating cash flow in the past year.
- MRO had positive earnings in 4 of the past 5 years.
- Each year in the past 5 years MRO had a positive operating cash flow.
1.2 Ratios
- MRO's Return On Assets of 6.85% is fine compared to the rest of the industry. MRO outperforms 61.46% of its industry peers.
- MRO's Return On Equity of 11.63% is in line compared to the rest of the industry. MRO outperforms 51.22% of its industry peers.
- The Return On Invested Capital of MRO (10.21%) is better than 67.32% of its industry peers.
- MRO had an Average Return On Invested Capital over the past 3 years of 13.87%. This is significantly below the industry average of 21.94%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.85% | ||
| ROE | 11.63% | ||
| ROIC | 10.21% |
ROA(3y)10.54%
ROA(5y)5.18%
ROE(3y)18.14%
ROE(5y)8.92%
ROIC(3y)13.87%
ROIC(5y)N/A
1.3 Margins
- Looking at the Profit Margin, with a value of 19.79%, MRO is in the better half of the industry, outperforming 65.85% of the companies in the same industry.
- In the last couple of years the Profit Margin of MRO has grown nicely.
- Looking at the Operating Margin, with a value of 29.96%, MRO is in the better half of the industry, outperforming 63.41% of the companies in the same industry.
- In the last couple of years the Operating Margin of MRO has grown nicely.
- MRO has a Gross Margin of 86.89%. This is amongst the best in the industry. MRO outperforms 92.68% of its industry peers.
- MRO's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 29.96% | ||
| PM (TTM) | 19.79% | ||
| GM | 86.89% |
OM growth 3YN/A
OM growth 5Y8.4%
PM growth 3YN/A
PM growth 5Y5.86%
GM growth 3Y2.24%
GM growth 5Y0.24%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), MRO is creating some value.
- Compared to 1 year ago, MRO has less shares outstanding
- MRO has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.76 indicates that MRO is not a great score, but indicates only limited risk for bankruptcy at the moment.
- The Altman-Z score of MRO (2.76) is better than 72.68% of its industry peers.
- The Debt to FCF ratio of MRO is 2.33, which is a good value as it means it would take MRO, 2.33 years of fcf income to pay off all of its debts.
- Looking at the Debt to FCF ratio, with a value of 2.33, MRO is in the better half of the industry, outperforming 73.17% of the companies in the same industry.
- A Debt/Equity ratio of 0.42 indicates that MRO is not too dependend on debt financing.
- The Debt to Equity ratio of MRO (0.42) is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.42 | ||
| Debt/FCF | 2.33 | ||
| Altman-Z | 2.76 |
ROIC/WACC1.27
WACC8.07%
2.3 Liquidity
- A Current Ratio of 0.69 indicates that MRO may have some problems paying its short term obligations.
- MRO has a worse Current ratio (0.69) than 79.02% of its industry peers.
- A Quick Ratio of 0.61 indicates that MRO may have some problems paying its short term obligations.
- MRO has a worse Quick ratio (0.61) than 78.05% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.69 | ||
| Quick Ratio | 0.61 |
3. Growth
3.1 Past
- The earnings per share for MRO have decreased strongly by -10.36% in the last year.
- The Earnings Per Share has been growing by 29.38% on average over the past years. This is a very strong growth
- The Revenue has decreased by -0.78% in the past year.
- Measured over the past years, MRO shows a small growth in Revenue. The Revenue has been growing by 1.30% on average per year.
EPS 1Y (TTM)-10.36%
EPS 3YN/A
EPS 5Y29.38%
EPS Q2Q%-16.88%
Revenue 1Y (TTM)-0.78%
Revenue growth 3Y29.48%
Revenue growth 5Y1.3%
Sales Q2Q%-3.97%
3.2 Future
- The Earnings Per Share is expected to decrease by -2.56% on average over the next years.
- MRO is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.14% yearly.
EPS Next Y-6.75%
EPS Next 2Y-4.99%
EPS Next 3Y-3.07%
EPS Next 5Y-2.56%
Revenue Next Year0.06%
Revenue Next 2Y0.04%
Revenue Next 3Y1.14%
Revenue Next 5YN/A
3.3 Evolution
- The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
- The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- MRO is valuated reasonably with a Price/Earnings ratio of 11.37.
- MRO's Price/Earnings ratio is in line with the industry average.
- Compared to an average S&P500 Price/Earnings ratio of 27.21, MRO is valued rather cheaply.
- Based on the Price/Forward Earnings ratio of 12.12, the valuation of MRO can be described as correct.
- The rest of the industry has a similar Price/Forward Earnings ratio as MRO.
- The average S&P500 Price/Forward Earnings ratio is at 24.26. MRO is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.37 | ||
| Fwd PE | 12.12 |
4.2 Price Multiples
- MRO's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. MRO is cheaper than 69.27% of the companies in the same industry.
- MRO's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. MRO is cheaper than 75.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.83 | ||
| EV/EBITDA | 4.76 |
4.3 Compensation for Growth
- MRO has a very decent profitability rating, which may justify a higher PE ratio.
- MRO's earnings are expected to decrease with -3.07% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.39
EPS Next 2Y-4.99%
EPS Next 3Y-3.07%
5. Dividend
5.1 Amount
- MRO has a Yearly Dividend Yield of 1.54%.
- MRO's Dividend Yield is slightly below the industry average, which is at 3.75.
- Compared to an average S&P500 Dividend Yield of 1.82, MRO has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.54% |
5.2 History
- The dividend of MRO is nicely growing with an annual growth rate of 15.43%!
- MRO has paid a dividend for at least 10 years, which is a reliable track record.
- MRO has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)15.43%
Div Incr Years4
Div Non Decr Years4
5.3 Sustainability
- 19.02% of the earnings are spent on dividend by MRO. This is a low number and sustainable payout ratio.
DP19.02%
EPS Next 2Y-4.99%
EPS Next 3Y-3.07%
Marathon Oil Corp / MRO FAQ
What is the fundamental rating for MRO stock?
ChartMill assigns a fundamental rating of 5 / 10 to MRO.
Can you provide the valuation status for Marathon Oil Corp?
ChartMill assigns a valuation rating of 5 / 10 to Marathon Oil Corp (MRO). This can be considered as Fairly Valued.
How profitable is Marathon Oil Corp (MRO) stock?
Marathon Oil Corp (MRO) has a profitability rating of 6 / 10.
What are the PE and PB ratios of Marathon Oil Corp (MRO) stock?
The Price/Earnings (PE) ratio for Marathon Oil Corp (MRO) is 11.37 and the Price/Book (PB) ratio is 1.4.
Can you provide the expected EPS growth for MRO stock?
The Earnings per Share (EPS) of Marathon Oil Corp (MRO) is expected to decline by -6.75% in the next year.