The firm said it reinstated coverage on the company which refines, transports, and markets petroleum products in the U.S, as it believes refiners will remain attractive on a "sum-of-the-parts" basis for the next one to two years.
"Despite the group's significant outperformance since 2011, we believe the U.S. refiners remain significantly undervalued. In our best case scenario, we estimate the group's average potential upside at 53% over the next couple years," Barclays said in a statement.
"We believe all the refiners will see upside from current levels,' Barclays added.
Separately, TheStreet Ratings team rates MARATHON PETROLEUM CORP as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
"We rate MARATHON PETROLEUM CORP (MPC) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its revenue growth, solid stock price performance, attractive valuation levels, good cash flow from operations and increase in net income. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- MPC's revenue growth has slightly outpaced the industry average of 2.8%. Since the same quarter one year prior, revenues slightly increased by 4.8%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Powered by its strong earnings growth of 61.20% and other important driving factors, this stock has surged by 31.72% over the past year, outperforming the rise in the S&P 500 Index during the same period. 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.
- The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Oil, Gas & Consumable Fuels industry. The net income increased by 44.2% when compared to the same quarter one year prior, rising from $593.00 million to $855.00 million.
- Net operating cash flow has significantly increased by 301.37% to $878.00 million when compared to the same quarter last year. In addition, MARATHON PETROLEUM CORP has also vastly surpassed the industry average cash flow growth rate of -4.80%.
- You can view the full analysis from the report here: MPC Ratings Report