Stocks

Marathon Oil (MRO) Outpaces Stock Market Gains: What You Should Know

In the latest trading session, Marathon Oil (MRO) closed at $11.34, marking a +1.98% move from the previous day. This move outpaced the S&P 500's daily gain of 1.52%.

Prior to today's trading, shares of the energy company had lost 17.26% over the past month. This has lagged the Oils-Energy sector's loss of 8.07% and the S&P 500's gain of 2.41% in that time.

MRO will be looking to display strength as it nears its next earnings release, which is expected to be August 4, 2021. The company is expected to report EPS of $0.17, up 128.33% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $1.12 billion, up 312.9% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $0.86 per share and revenue of $4.63 billion, which would represent changes of +174.14% and +49.88%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for MRO. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 21.94% higher within the past month. MRO currently has a Zacks Rank of #2 (Buy).

Valuation is also important, so investors should note that MRO has a Forward P/E ratio of 12.86 right now. This valuation marks a discount compared to its industry's average Forward P/E of 13.02.

We can also see that MRO currently has a PEG ratio of 0.34. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Oil and Gas - Integrated - United States industry currently had an average PEG ratio of 1.87 as of yesterday's close.

The Oil and Gas - Integrated - United States industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 61, which puts it in the top 25% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow MRO in the coming trading sessions, be sure to utilize Zacks.com.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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