Back to top

Analyst Blog

Independent refiner, transporter and marketer firm Marathon Petroleum Corporation (MPC - Analyst Report) announced the filling of the initial public offering (IPO) for the shares of its wholly owned subsidiary, MPLX L.P., with the Securities and Exchange Commission (SEC).

Marathon Petroleum expects to raise nearly $365 million, to be directed towards expansion and other activities, through the offering. However, the number of shares on offer and the price range have yet to be decided.

The pipeline and storage subsidiary, which was formed by Marathon Petroleum in March, will likely trade on the New York Stock Exchange under the symbol "MPLX."

MPLX L.P. is primarily involved with the acquisition and development of crude oil, refined products and other hydrocarbon-based product pipelines and other associated midstream assets. The partnership will hold 100% interest in a butane cavern in West Virginia along with a 51% stake in a network of crude oil and products pipeline and storage units across Midwest and Gulf Coast regions.

Findlay, Ohio-based Marathon Petroleum came into existence following the 2011 spin-off of Houston, Texas-based Marathon Oil Corporation's (MRO - Analyst Report) refining/sales business into a separate, independent and publicly traded entity. Marathon Petroleum operates in three segments: Refining and Marketing, Speedway (Retail) and Pipeline Transportation.

Marathon Petroleum, the fifth largest domestic refiner, exhibits a combined crude oil processing capacity of approximately 1,193,000 barrels per day through its portfolio of six refineries. A major advantage for the company is its proprietary access to pipelines, which inhibits lower-cost competitors from supplying to Marathon Petroleum's key markets.

Additionally, the company possesses one of the healthiest balance sheets among its peers and a robust free cash flow generating ability. The recent commencement of the $2 billion buyback program highlights Marathon Petroleum's commitment to create value for shareholders.

Hence, we believe that Marathon Petroleum is well positioned going forward and view it as an attractive investment as reflected through our long-tern Outperform recommendation.

Please login to Zacks.com or register to post a comment.

New to Zacks?

Start Here

Zacks Investment Research

Close

Are you a new Zacks Member or a visitor to Zacks.com?

Top Zacks Features

My Portfolio Tracker

Is it Time to Sell?

One of the most important steps you can take today is to set up your portfolio tracker on Zacks.com. Once you do, you'll be notified of major events affecting your stocks and/or funds with daily email alerts.

More Zacks Resources

Zacks Rank Home - Evaluate your stocks and use the Zacks Rank to eliminate the losers and keep the winners.

Mutual Fund Rank Home - Evaluate your funds with the Mutual Fund Rank for both your personal and retirement funds.

Stock/Mutual Fund Screening - Find better stocks and mutual funds. The ones most likely to beat the market and provide a positive return.

My Portfolio - Track your Portfolio and find out where your stocks/mutual funds stack up with the Zacks Rank.

Zacks #1 Rank Top Movers for Zacks #1 Rank Top Movers

Company Symbol Price %Chg
GTT COMMUNI… GTT 11.65 +4.11%
ALLERGAN IN… AGN 161.82 +3.99%
CLAYTON WIL… CWEI 117.06 +3.73%
GREENBRIER… GBX 69.63 +2.37%
RF MICRO DE… RFMD 12.02 +2.04%