MPC

We rate Marathon Petroleum Corp (MPC) as a Hold with a composite score of 51.2/100 at a current price of $195.29. The stock presents a mixed quantitative picture — neither compelling enough to warrant new accumulation nor weak enough to justify selling for existing holders. Our factors are split, and the overall profile suggests patience is warranted.

The rating is primarily driven by strength in stability (73th percentile) and value (59th percentile), which together account for the majority of the composite score. Offsetting weakness in momentum (30th percentile) and investment (38th percentile) tempers our overall conviction. We assign a No Moat rating (31/100), High uncertainty, and Standard capital allocation.

Key items to watch: momentum to confirm whether the current price trend has legs; balance sheet deleveraging progress. Any material change in these dynamics could warrant a reassessment of our rating. The moat trend is stable, which suggests the competitive landscape is stable for now.

Marathon Petroleum Corp holds a top-quartile position (#0 of 50) within the Mining sector, based on our composite quantitative scoring across quality, value, momentum, and stability factors. The composite score of 51.2/100 places it at rank #1829 in our full 7,333-stock universe. With a $58.6B market capitalization, Marathon Petroleum Corp operates at meaningful scale within the Mining sector, providing competitive advantages in distribution, procurement, and customer reach.

Revenue contraction of -8% combined with momentum at the 30th percentile paints a cautious picture of the near-term business outlook. The market appears to be pricing in continued challenges, and a catalyst for reversal is not clearly visible from current data.

The margin cascade tells an important story: gross margins of 9% (-34.0pp vs sector) narrow to operating margins of 5% (-7.2pp vs sector) and net margins of 3.6%, yielding a gross-to-net conversion rate of 39%. This efficient conversion suggests well-controlled operating costs and limited margin leakage between the gross and net levels.

At a current price of $195.29, Marathon Petroleum Corp is trading near fair value based on current fundamentals. Our value factor score of 59/100 reflects a composite assessment across multiple valuation metrics including price-to-earnings, price-to-book, EV/EBITDA, and price-to-sales ratios relative to both sector peers and the broader market. Valuation metrics are mixed, with no strong signal of mispricing in either direction.

The stock currently trades at a P/E of 11.8x (roughly in line with the sector median of 13.7x), EV/EBITDA of 8.4x (at a premium), P/B of 2.4x, P/S of 0.4x. The below-sector P/E suggests possible undervaluation or the market pricing in near-term headwinds.

We assign a High uncertainty rating to Marathon Petroleum Corp. Key risk factors include significant leverage (248% debt-to-equity), the combination of leverage (248% D/E) and thin margins (3.6% net) amplifies downside risk. The wide range of potential outcomes widens our fair value estimate and increases the possibility of permanent capital impairment. Investors considering this name should size positions accordingly and demand a meaningful margin of safety before initiating.

Specific risk factors that inform our assessment include: significant leverage (248% debt-to-equity); the combination of leverage (248% D/E) and thin margins (3.6% net) amplifies downside risk. Each of these factors independently widens the distribution of potential outcomes, and in combination they create a risk profile that demands careful position sizing. The stability factor at the 73th percentile and quality factor at the 55th percentile provide a quantitative summary of the overall risk landscape.

Key risk mitigants include: above-average stability (73th percentile) suggests predictable business dynamics; large-cap scale ($58.6B) provides resilience. These factors partially offset the identified risks and provide downside protection in adverse scenarios. On balance, the risk-reward profile warrants caution and disciplined position management.

We rate Marathon Petroleum Corp's capital allocation as Standard. Management has shown adequate — though not exceptional — stewardship of shareholder capital. Returns on equity stand at 20.6%, and the balance sheet is managed within acceptable parameters (D/E: 248%). Exemplary allocators typically sustain ROE above 20% and D/E below 50%; Marathon Petroleum Corp falls short on at least one dimension.

There is room for improvement in optimizing the capital structure or enhancing shareholder returns. The 1.89% dividend yield provides some income return, but the overall capital allocation framework would benefit from either higher reinvestment returns, improved balance sheet efficiency, or increased shareholder distributions. We will monitor for signs of strategic improvement that could warrant an upgrade.

In summary, Marathon Petroleum Corp receives a Hold rating with a composite score of 51.2/100 (rank #1829 of 7,333). Our quantitative framework assigns a No Moat (31/100, trend: stable), High uncertainty, and Standard capital allocation. The average factor score across quality, value, momentum, stability, and investment is 51/100.

Our analysis supports a neutral stance on Marathon Petroleum Corp. While the quantitative profile is not weak enough to warrant selling, it lacks the multi-factor strength required for a buy recommendation. Existing holders should maintain positions and monitor for catalysts — either fundamental improvement or valuation compression — that would shift the risk-reward balance.