Trade-Ideas: Marathon Petroleum (MPC) Is Today's Unusual Social Activity Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Marathon Petroleum ( MPC) as an unusual social activity candidate. In addition to specific proprietary factors, Trade-Ideas identified Marathon Petroleum as such a stock due to the following factors:

  • MPC has 13x the normal benchmarked social activity for this time of the day compared to its average of 1.94 mentions/day.
  • MPC has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $178.1 million.

Identifying stocks with 'Unusual Social Activity' tends to be a valuable process for traders looking to capitalize on the 'talk of the town' stocks that are basking in far more attention from the StockTwits financial community than normal. Good press? Bad press? It ultimately doesn't matter if it's good or bad if you know how to trade around the sentiment. Certain hedge funds use such data for their proprietary algorithms and it is not uncommon to see shared social sentiment play itself out in a stock's price trend.

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More details on MPC:

Marathon Petroleum Corporation, together with its subsidiaries, engages in refining, transporting, and marketing petroleum products primarily in the United States. It operates through Refining & Marketing, Speedway, and Pipeline Transportation segments. The stock currently has a dividend yield of 2.4%. MPC has a PE ratio of 7.2. Currently there are 7 analysts that rate Marathon Petroleum a buy, 1 analyst rates it a sell, and 3 rate it a hold.

The average volume for Marathon Petroleum has been 3.1 million shares per day over the past 30 days. Marathon has a market cap of $22.2 billion and is part of the basic materials sector and energy industry. The stock has a beta of 2.72 and a short float of 1.5% with 1.70 days to cover. Shares are up 12.5% year to date as of the close of trading on Monday.

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TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Marathon Petroleum as a buy. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels, largely solid financial position with reasonable debt levels by most measures and notable return on equity. We feel these strengths outweigh the fact that the company shows low profit margins.

Highlights from the ratings report include:
  • The revenue growth greatly exceeded the industry average of 6.5%. Since the same quarter one year prior, revenues rose by 28.0%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Compared to its closing price of one year ago, MPC's share price has jumped by 43.28%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, MPC should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • MPC's debt-to-equity ratio is very low at 0.29 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Although the company had a strong debt-to-equity ratio, its quick ratio of 0.90 is somewhat weak and could be cause for future problems.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. In comparison to other companies in the Oil, Gas & Consumable Fuels industry and the overall market on the basis of return on equity, MARATHON PETROLEUM CORP has underperformed in comparison with the industry average, but has greatly exceeded that of the S&P 500.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12-months. Learn more.
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