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Marathon Petroleum (MPC) Beats on Q2 Earnings, Falls Y/Y
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Ohio-based independent oil refiner and marketer, Marathon Petroleum Corp. (MPC - Free Report) reported better-than-expected second-quarter 2016 results, owing to improved merchandise margins and contribution from new and existing pipeline. The positives were offset partially by decreased crack spread in the Gulf Coast.
The company reported earnings per share – excluding onetime items – of $1.07, which surpassed the Zacks Consensus Estimate of 95 cents. The bottom line, however, fell from the year-ago period adjusted profit of $1.51.
Quarterly revenues of $16,790 million beat the Zacks Consensus Estimate of $15,845 million. The top line, however, fell from the year-ago figure of $20,581 million.
Segmental Performance
Refining & Marketing: The unit reported profits of $1,080 million in the reported quarter, down from $1,181 million in the year-ago comparable quarter. Decreased crack spread in the Gulf Coast led to the underperformance.
Total refined product sales volumes were 2,348 thousand barrels per day (mbpd), slightly up from 2,341 mbpd in the year-ago quarter. Throughput fell from 1,951 mbpd in the year-ago quarter to 1,889 mbpd.
Speedway:Income from the Speedway retail stations was $193 million, up from $127 million in the year-ago comparable quarter. Improved margins from merchandise drove the improvement.
Midstream: Segment profitability was $201 million, significantly up from $103 million in the second quarter of 2015. Earnings were propped up by the completion of the MarkWest acquisition on Dec 4, 2015. Contribution from new and existing pipeline also aided the result.
Total Expenses
Marathon Petroleum reported expenses of $15.5 billion in second-quarter 2016, lower than $19.3 billion in the year-ago quarter.
Capital Expenditure, Balance Sheet & Share Repurchase
In the reported quarter, Marathon Petroleum spent $787 million on capital programs (51.2% on the Midstream segment). As of Jun 30, 2016, the company had cash and cash equivalents of $1,754 million and total debt of $11,059 million, with a debt-to-capitalization ratio of 36%.
Dividend Hike
The company has announced a dividend of 36 cents per share, representing a hike of 12.5% from second-quarter 2016.
Marathon Petroleum currently carries a Zacks Rank #5 (Strong Sell), implying that it will significantly underperform the broader U.S. equity market over the next one to three months.
Some better-ranked players in the energy sector are Murphy USA Inc. (MUSA - Free Report) , World Fuel Services Corp. and North Atlantic Drilling Ltd. . Each of these stocks sports a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
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Marathon Petroleum (MPC) Beats on Q2 Earnings, Falls Y/Y
Ohio-based independent oil refiner and marketer, Marathon Petroleum Corp. (MPC - Free Report) reported better-than-expected second-quarter 2016 results, owing to improved merchandise margins and contribution from new and existing pipeline. The positives were offset partially by decreased crack spread in the Gulf Coast.
The company reported earnings per share – excluding onetime items – of $1.07, which surpassed the Zacks Consensus Estimate of 95 cents. The bottom line, however, fell from the year-ago period adjusted profit of $1.51.
Quarterly revenues of $16,790 million beat the Zacks Consensus Estimate of $15,845 million. The top line, however, fell from the year-ago figure of $20,581 million.
Segmental Performance
Refining & Marketing: The unit reported profits of $1,080 million in the reported quarter, down from $1,181 million in the year-ago comparable quarter. Decreased crack spread in the Gulf Coast led to the underperformance.
Total refined product sales volumes were 2,348 thousand barrels per day (mbpd), slightly up from 2,341 mbpd in the year-ago quarter. Throughput fell from 1,951 mbpd in the year-ago quarter to 1,889 mbpd.
Speedway: Income from the Speedway retail stations was $193 million, up from $127 million in the year-ago comparable quarter. Improved margins from merchandise drove the improvement.
Midstream: Segment profitability was $201 million, significantly up from $103 million in the second quarter of 2015. Earnings were propped up by the completion of the MarkWest acquisition on Dec 4, 2015. Contribution from new and existing pipeline also aided the result.
Total Expenses
Marathon Petroleum reported expenses of $15.5 billion in second-quarter 2016, lower than $19.3 billion in the year-ago quarter.
Capital Expenditure, Balance Sheet & Share Repurchase
In the reported quarter, Marathon Petroleum spent $787 million on capital programs (51.2% on the Midstream segment). As of Jun 30, 2016, the company had cash and cash equivalents of $1,754 million and total debt of $11,059 million, with a debt-to-capitalization ratio of 36%.
Dividend Hike
The company has announced a dividend of 36 cents per share, representing a hike of 12.5% from second-quarter 2016.
MARATHON PETROL Price, Consensus and EPS Surprise
MARATHON PETROL Price, Consensus and EPS Surprise | MARATHON PETROL Quote
Zacks Rank
Marathon Petroleum currently carries a Zacks Rank #5 (Strong Sell), implying that it will significantly underperform the broader U.S. equity market over the next one to three months.
Some better-ranked players in the energy sector are Murphy USA Inc. (MUSA - Free Report) , World Fuel Services Corp. and North Atlantic Drilling Ltd. . Each of these stocks sports a Zacks Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>