Opinion

Texas Oil & Gas Firm Positioned for Faster Growth with Potential Upside


Raymond James provided a general outlook on this company post-merger and pre-Investor Day.

oil pump
Oil pump

In a Nov. 20 research note, analyst Justin Jenkins observed that with the Andeavor acquisition behind it, Marathon Petroleum Corp. (MPC:NYSE) is "uniquely positioned to continue optimizing its now industry-leading refining position while creating even faster growth in the higher-value Midstream and Retail segments."

Jenkins explained that Marathon should benefit from upside related to merger synergies and "a strengthened refining suite that is well positioned for wide crude differentials and IMO 2020," referring to the International Maritime Organization's 0.5% global sulphur cap on marine fuels effective Jan. 1, 2020. Further upside should result from "robust opportunities" in the Speedway and Midstream segments.

At the same time, headwinds, specifically current weak gasoline margins, are expected.

Jenkins relayed what Raymond James expects Marathon to provide on its Investor Day and what it would like Marathon to provide on Investor Day. The former are:

  1. An update and overview of synergies and growth targets resulting from the Andeavor merger. Jenkins noted the estimated synergies target could be higher than the previously discussed $1 billion.
  2. Further details on the current refining market and margins outlook and expectations regarding IMO 2020.
  3. Updated guidance for Q4/18 and 2019 operations and reporting outlook.
  4. Capital allocation plans.

"If new guidance figures and capital allocation outlook are well received, a bounce in shares could be due," Jenkins asserted.

A detailed explanation of Marathon's free cash flow profile would be helpful to investors, Jenkins wrote, because the company's reporting structure is complex and numerous changes have resulted from the Andeavor acquisition.

Raymond James maintains its Strong Buy rating and its $106 per share target price on Marathon, whose share price today is around $65.95.

 


Visit source site

https://streetwisereports.com/article/2018/11/29/t...

TexasUnited StatesOilgasNYSEMarathon Oil CorporationRaymond James

More items from oilvoice


Equinor Deepens in Offshore Wind in Poland

Equinor has exercised an option to acquire a 50 % interest in the offshore wind development project Bałtyk I in Poland from Polenergia. This transaction is a follow-up of the agreement between the two companies which came into force in May 2018 , by which Equinor acquired a 50 % inter ...

OilVoice Press - OilVoice


Posted 4 months agoPress > EquinorEquinor EnergyPoland +2

Nigeria has highest capex on crude and natural gas projects in sub-Saharan Africa Over Next Seven Years, says GlobalData

Nigeria accounts for more than 34% of the proposed capital expenditure (capex) on planned and announced crude and natural gas projects in the sub-Saharan Africa over the period 2018–2025, according to GlobalData , a leading data and analytics company. The company's report: ‘H2 2018 Production ...

OilVoice Press - OilVoice


Posted 4 months agoOpinion > GlobalDataNigeriaCrude +5

CNOOC Signs Strategic Cooperation Agreements with 9 International Oil Companies

HONG KONG, Dec. 18, 2018 /PRNewswire/ -- CNOOC Limited (the "Company", SEHK: 00883, NYSE: CEO, TSX: CNU) announced today that its parent company, China National Offshore Oil Corporation (CNOOC), has signed Strategic Cooperation Agreements with 9 international oil companies including: Chevron, Conoco ...

OilVoice Press - OilVoice


Posted 4 months agoPress > CNOOCChina National Offshore Oil CorporationChevron +11

Total Announces the Distribution of its Second 2018 Interim Dividend

The Board of Directors met on December 12, 2018 and declared  the distribution of a second interim dividend for the 2018 fiscal year of €0.64 per share, in accordance with the Board's decision of July 25, 2018, an amount equal to the first 2018 interim dividend and an increase of 3.2% compared to t ...

OilVoice Press - OilVoice


Posted 4 months agoPress > TotalDividend

Methyl Tertiary Butyl Ether Capacity Will Grow at a CAGR of 16.8% in India Over Next Four Years, says GlobalData

India's Methyl Tertiary Butyl Ether (MTBE) plant capacity is forecasted to grow at a compound annual growth rate (CAGR) of 16.8% from 0.211 million tons per annum (mtpa) in 2017 to 0.460 mtpa in 2022, according to GlobalData , a leading data and analytics company. The company's report: ‘ Met ...

OilVoice Press - OilVoice


Posted 4 months agoOpinion > GlobalDataIndiaMTBE
All posts from oilvoice