Marathon Petroleum Corporation (MPC) Stock Valuation — PE Analysis
Oil & Gas Refining & Marketing · NYSE
Current Price
$263.58
PE Ratio (TTM)
16.8x
Intrinsic Value
$515.06
+48.8% margin of safety
COMPETITIVE MOAT
↑Strategic West Coast Refining
MPC's significant West Coast refining capacity, including the region's largest refinery, benefits from persistent fuel supply constraints in California. This positions them to capitalize on regional demand imbalances.
↑Integrated Midstream Operations
Their extensive midstream infrastructure provides logistical advantages and cost efficiencies in transporting crude oil and refined products. This integration enhances their operational flexibility and market access.
↑Scale and Efficiency
As one of the largest refiners, MPC benefits from economies of scale in purchasing, operations, and distribution. This scale allows for greater cost control and competitive pricing.
INVESTMENT RISKS
↓Geopolitical Oil Price Volatility
Collapsing peace talks and geopolitical tensions can lead to significant fluctuations in crude oil prices. This volatility directly impacts MPC's input costs and refined product margins.
↓Regulatory and Environmental Pressures
The refining industry faces ongoing scrutiny regarding environmental regulations and emissions standards. Stricter policies could necessitate costly upgrades and impact operational flexibility.
↓Demand Sensitivity to Economic Cycles
Demand for refined products is closely tied to overall economic activity. Economic downturns or recessions can significantly reduce fuel consumption, impacting MPC's sales volumes and profitability.
Base case
MPC base case PE valuation
A base case PE valuation for MPC estimates a fair value of about $515.06 per share, against a current price of $263.58. The model assumes 20.0% annual earnings growth, a 17x target PE multiple, and a 10% discount rate.
Intrinsic Value
$515.06
Margin of safety
+48.8%
Expected annual return
+14.3%
Base case assumptions: 20.0% annual earnings growth, 17x target PE, 10% discount rate, 5 year projection. Data as of 2026-06-12.
This base case uses default assumptions and is not financial advice. The fair value changes significantly when the target PE or earnings growth rate changes. Open the calculator to set your own assumptions and see the full sensitivity range.
Customize the MPC PE valuation
Adjust the target PE, earnings growth, and discount rate to see how the fair value and margin of safety for Marathon Petroleum Corporation respond.
Open PE Calculator for MPCCompany Overview
Marathon Petroleum Corporation (MPC) functions as a prominent integrated energy enterprise, primarily concentrating its downstream operations across the United States. Its business is bifurcated into two main divisions: Refining & Marketing, and Midstream. The Refining & Marketing segment is responsible for processing crude oil and various other raw materials at its refineries, strategically located in the U.S. Gulf Coast, Mid-Continent, and West Coast regions. This division also acquires refined petroleum products and ethanol for subsequent distribution. Key outputs from this segment encompass a diverse array of transportation fuels, including different gasoline blends, heavy fuel oil, and asphalt. Additionally, it manufactures chemicals such as aromatics, propane, propylene, and sulfur. MPC sells these refined goods through multiple channels, including wholesale marketers domestically and globally, purchasers on the open spot market, and independent entrepreneurs who manage primarily Marathon-branded retail locations. It also supplies fuel via long-term agreements to direct dealer sites, predominantly under the ARCO brand. The Midstream segment handles the comprehensive movement, storage, distribution, and commercialization of crude oil and refined products. This is achieved through its extensive network of refining logistics assets, pipelines, terminals, towboats, and barges. Moreover, this segment engages in the collection, processing, and transportation of natural gas, alongside the gathering, transport, fractionation, storage, and marketing of natural gas liquids. By December 31, 2021, the corporation supported 7,159 branded jobber retail points, managed by independent entrepreneurs, spanning 37 U.S. states, the District of Columbia, and Mexico. Marathon Petroleum Corporation, established in 1887, maintains its corporate headquarters in Findlay, Ohio.
Financial Metrics — MPC PE Stock Valuation Data
PE Ratio (TTM)
16.8x
PEG Ratio
0.15
Earnings Yield
5.96%
ROE (TTM)
27.3%
Revenue/Share (TTM)
$460.17
Dividend Yield
1.48%
Debt/Equity
2.05x
Frequently Asked Questions
What is the PE ratio of MPC?
The trailing twelve-month PE ratio of MPC reflects how much investors pay per dollar of Marathon Petroleum Corporation's earnings. This metric is most useful when compared to Oil & Gas Refining & Marketing peers and the company's own historical range.
Is MPC overvalued based on PE ratio?
MPC's PE of 16.8x combined with a PEG ratio of 0.15 provides a growth-adjusted perspective. A PEG below 1.0 suggests MPC may be undervalued relative to its earnings growth rate. Keep in mind that PE-based valuation works best for profitable, mature companies — for high-growth or cyclical Oil & Gas Refining & Marketing, a DCF analysis may be more appropriate.
How do I value MPC stock using PE ratio?
To value Marathon Petroleum Corporation using PE: (1) Compare the current PE (16.8x) against the Oil & Gas Refining & Marketing median to assess relative pricing, (2) check the PEG ratio (0.15) to adjust for growth expectations, (3) review the 5-year PE range to identify where the stock sits historically, and (4) estimate fair value by multiplying a target PE by forward EPS estimates. This relative approach complements DCF's absolute valuation.
What is the PEG ratio of MPC?
MPC's PEG ratio is 0.15, calculated by dividing the PE ratio (16.8x) by the expected earnings growth rate. A PEG below 1.0 is traditionally considered a sign of undervaluation — the market may not be fully pricing in the growth potential. Note that PEG accuracy depends on the reliability of growth estimates.
Should I use PE ratio or DCF for MPC stock valuation?
PE ratio gives a quick relative read — how MPC is priced versus Oil & Gas Refining & Marketing peers. DCF provides an absolute value based on projected free cash flows. For MPC, with a strong ROE of 27.3%, both methods are worth using — PE for a market-relative check, DCF to stress-test whether fundamentals justify the price. Each method has blind spots: PE ignores capital structure and cash flow quality, while DCF is sensitive to growth and discount rate assumptions.
Learn More
- See MPC DCF Valuation → — Intrinsic value via Discounted Cash Flow analysis
- PE Methodology — Step-by-step guide to PE ratio stock valuation
- DCF Methodology — Guide to discounted cash flow analysis
- PE Ratio — Understanding the price-to-earnings ratio
- Intrinsic Value — How to evaluate stock fair value
Related PE Valuations
All Energy valuationsP/E and DCF value MPC with different methods and assumptions, so the two conclusions can differ. Compare the DCF intrinsic value.
Price as of 2026-06-12. Financial data from Financial Modeling Prep (trailing twelve months) · Valuation methodology by Charlie Wang.
This is an estimate, not investment advice.