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Should Value Investors Buy Marathon Petroleum (MPC) Stock?

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The proven Zacks Rank system focuses on earnings estimates and estimate revisions to find winning stocks. Nevertheless, we know that our readers all have their own perspectives, so we are always looking at the latest trends in value, growth, and momentum to find strong picks.

Considering these trends, value investing is clearly one of the most preferred ways to find strong stocks in any type of market. Value investors use tried-and-true metrics and fundamental analysis to find companies that they believe are undervalued at their current share price levels.

Zacks has developed the innovative Style Scores system to highlight stocks with specific traits. For example, value investors will be interested in stocks with great grades in the "Value" category. When paired with a high Zacks Rank, "A" grades in the Value category are among the strongest value stocks on the market today.

One company to watch right now is Marathon Petroleum (MPC - Free Report) . MPC is currently sporting a Zacks Rank of #2 (Buy) and an A for Value.

MPC is also sporting a PEG ratio of 1.76. This popular figure is similar to the widely-used P/E ratio, but the PEG ratio also considers a company's expected EPS growth rate. MPC's PEG compares to its industry's average PEG of 1.81. Within the past year, MPC's PEG has been as high as 2.34 and as low as 0.92, with a median of 1.51.

Finally, investors should note that MPC has a P/CF ratio of 5.73. This metric takes into account a company's operating cash flow and can be used to find stocks that are undervalued based on their solid cash outlook. This company's current P/CF looks solid when compared to its industry's average P/CF of 5.97. Over the past 52 weeks, MPC's P/CF has been as high as 6.40 and as low as 2.39, with a median of 3.97.

These figures are just a handful of the metrics value investors tend to look at, but they help show that Marathon Petroleum is likely being undervalued right now. Considering this, as well as the strength of its earnings outlook, MPC feels like a great value stock at the moment.


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