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Wall Street Analysts Assess Marathon Oil after Its 1Q16 Earnings

Did Marathon Oil’s 1Q16 Earnings Beat Analysts' Estimates?

(Continued from Prior Part)

Wall Street analysts’ ratings for Marathon Oil

Currently, ~41% of Wall Street analysts rate Marathon Oil (MRO) as a “buy” and ~52% of analysts rate it as a “hold.” Around 7% rate the stock as a “sell.”

The median price target from these recommendations is $14.83, which is ~22% higher than its May 4, 2016, closing price of $12.17.

Based on the median price targets of recommendations from Wall Street analysts, upstream companies EOG Resources (EOG), Energen Corporation (EGN), and Pioneer Natural Resources (PXD) have potential upsides of ~4%, ~8%, and ~15%, respectively, from their May 4, 2016, closing prices.

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EOG Resources (EOG), Energen Corporation (EGN), and Pioneer Natural Resources (PXD) have similar crude oil percentages in their production mix to that of Marathon Oil. These stocks contain crude oil in a range of 49%–60% in their production mix, whereas Marathon Oil contains ~53% crude oil in its production mix. The SPDR S&P Oil and Gas Exploration & Production ETF (XOP) generally invests at least 80% of its total assets in oil and gas exploration companies whereas the Vanguard Energy ETF (VDE) invests into the broader energy market.

Marathon Oil’s individual recommendations

As the above table shows, Wall Street analysts issued forecasts for Marathon Oil following its latest earnings release.

The most recent recommendation of “equalweight/in-line” comes from Morgan Stanley, which was issued on May 5, 2016. Morgan Stanley assigned Marathon Oil the target price of $10, which is ~18% lower than its May 4, 2016, closing price of $12.17. Morgan Stanley expects the company to reach the target price within the next 12 months from the date of recommendation.

BMO Capital Markets assigned Marathon Oil the highest target price of $15, which is ~23% higher than the May 4, closing price of $12.17. BMO Capital Markets issued its recommendation on May 4 and expects it to reach the target price within 12 months from the date of recommendation.

Continue to Next Part

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