Marathon Petroleum Corporation Just Beat Analyst Forecasts, And Analysts Have Been Updating Their Predictions
It’s been a pretty great week for Marathon Petroleum Corporation (NYSE:MPC) shareholders, with its shares surging 11% to US$196 in the week since its latest full-year results. It looks like a credible result overall — although revenues of US$133b were what the analysts expected, Marathon Petroleum surprised by delivering a (statutory) profit of US$13.22 per share, an impressive 21% above what was forecast. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.
Taking into account the latest results, the 14 analysts covering Marathon Petroleum provided consensus estimates of US$121.6b revenue in 2026, which would reflect an uncomfortable 8.9% decline over the past 12 months. Statutory earnings per share are forecast to shrink 3.5% to US$13.24 in the same period. Before this earnings report, the analysts had been forecasting revenues of US$122.6b and earnings per share (EPS) of US$12.80 in 2026. So the consensus seems to have become somewhat more optimistic on Marathon Petroleum’s earnings potential following these results.
View our latest analysis for Marathon Petroleum
The consensus price target was unchanged at US$197, implying that the improved earnings outlook is not expected to have a long term impact on value creation for shareholders. There’s another way to think about price targets though, and that’s to look at the range of price targets put forward by analysts, because a wide range of estimates could suggest a diverse view on possible outcomes for the business. The most optimistic Marathon Petroleum analyst has a price target of US$220 per share, while the most pessimistic values it at US$163. The narrow spread of estimates could suggest that the business’ future is relatively easy to value, or thatthe analysts have a strong view on its prospects.
These estimates are interesting, but it can be useful to paint some more broad strokes when seeing how forecasts compare, both to the Marathon Petroleum’s past performance and to peers in the same industry. We would highlight that revenue is expected to reverse, with a forecast 8.9% annualised decline to the end of 2026. That is a notable change from historical growth of 6.7% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 3.7% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining — Marathon Petroleum is expected to lag the wider industry.
The most important thing here is that the analysts upgraded their earnings per share estimates, suggesting that there has been a clear increase in optimism towards Marathon Petroleum following these results. On the plus side, there were no major changes to revenue estimates; although forecasts imply they will perform worse than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates — from multiple Marathon Petroleum analysts — going out to 2028, and you can see them free on our platform here.
Don’t forget that there may still be risks. For instance, we’ve identified 1 warning sign for Marathon Petroleum that you should be aware of.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.