MPC · Marathon Petroleum
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $425
Note written ·
How this view changed
- · Rating cut from Medium to Low. The note's kill line was crossed, 4 November 2026: Marathon Petroleum shares closed at $392.68 on 4 November 2026, below the published $420.00 kill line, the session after a third-quarter report showing a $45.70-a-barrel refining margin.
Price against the kill line
2.4% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $425.00, on record since 11 November 2026. The shares are up 16.1% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $425, over the 50-day moving average of $422.88 as of 11 November 2026 and back above the level the shares broke on 4 November 2026, which would show the shares leading again. A fourth-quarter refining margin above the third quarter's $45.70 a barrel would also show it.
Research onlyNot in the portfolio.
Key figures from the filings · Energy
Quarter to 30 September 2026, filed 3 November 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 56,032
- Revenue, change on a year (%)
- +61.0
- Gross margin (%)
- 21.8
- Operating margin (%)
- 18.7
- Free cash flow, four quarters ($M)
- 20,842
- Net cash, cash less debt ($M)
- −19,883
- Price to earnings (×)
- 7.7
- Enterprise value to sales (×)
- 0.8
All filed numbers
What Marathon Petroleum reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 56,032 | +61.0 | 21.8 | 18.7 |
| first filed | 51,994 | +53.8 | 17.2 | 14.1 |
| first filed | 34,200 | +8.5 | 8.6 | 4.1 |
| first filed | 32,574 | −1.7 | 11.4 | 8.3 |
| first filed | 34,809 | −0.8 | 10.4 | 7.8 |
| first filed | 33,799 | −10.9 | 11.2 | 6.5 |
| Pre-tax income ($M) | 10,163 |
| Net income ($M) four quarters: 14,631 | 7,447 |
| Diluted shares, change on a year (%) against the quarter to 30 September 2025 | −7.9 |
| Operating cash flow ($M) | 25,249 |
| Capital spending ($M) | 4,407 |
| Free cash flow ($M) | 20,842 |
| Cash and short-term investments ($M) | 13,609 |
| Debt ($M) | 33,492 |
| Net cash, cash less debt ($M) | −19,883 |
| Deferred revenue ($M) | 357 |
| Backlog, orders not yet delivered ($M) | Not reported |
| Receivables ($M) | 17,434 |
| Inventory ($M) | 10,196 |
| Shareholders' equity ($M) | 23,209 |
| Market value ($M) | 112,902 |
| Enterprise value, market value plus net debt ($M) | 132,785 |
| Enterprise value to sales (×) | 0.8 |
| Enterprise value to operating income (×) | 6.1 |
| Price to earnings (×) | 7.7 |
| Price to book value (×) | 4.9 |
| Free-cash-flow yield (%) | 18.5 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 2.6% of shares outstanding sold short, 3.6 days of average trading to cover, +1.5% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $0 | $739K |
| 12 monthsfrom | $0 | $13.9M |
The thesis
Marathon Petroleum delivered the margin its case called for, and the shares fell anyway. The rating is Low because the market treats third-quarter refining margins as a peak, so the shares are more likely to lag the S&P 500. The fourth-quarter report, expected in early February 2027, shows whether margins hold.
The company reported on 3 November 2026 a third-quarter refining and marketing margin of $45.70 a barrel. That compares with $36.33 in the second quarter and $17.60 a year earlier, per its 8-K. Adjusted earnings per share (EPS) were $26.93 against a Zacks consensus of $25.74, and crude utilisation was 100%.
The $420.00 kill line was crossed on 4 November 2026, when the shares closed at $392.68. The crossing showed that the beat was already in the price. Investors are now pricing how long these margins last. The shares fell further to a $372.74 close on 6 November 2026, then recovered to $402.84 on 11 November 2026.
At $402.84 on 11 November 2026, the shares sat 18.5% below their 52-week intraday high of $493.98, set on 19 October 2026, in the same weeks the company reported its widest quarterly margin of the past year. The price already assumes margins ease from third-quarter levels. Benzinga reported on 3 November 2026 that management expects elevated refining margins through at least mid-2027. The next two quarterly reports test that view.
Bullish and bearish views on Marathon Petroleum Corporation
The bull case on Marathon Petroleum Corporation (MPC), in brief: the third quarter beat on every line. The bear case: a beat did not hold the shares.
Bull case
- The third quarter beat on every line. Net income attributable to Marathon was $7.4 billion, or $26.59 per diluted share, against $4.51 a year earlier (8-K, 3 November 2026). Quarterly revenue was $56.03 billion against $34.81 billion a year earlier (10-Q, 3 November 2026).
- Cash returns expanded again. Marathon returned $3.3 billion to shareholders in the third quarter. A new $5 billion repurchase authorization lifts the total available to $8.1 billion (8-K, 3 November 2026). The quarterly dividend rose 10% to $1.10, payable 10 December 2026.
- MPLX raised its payout. MPLX increased its quarterly distribution 12.5%, which Marathon expects to bring it $3.1 billion a year in distributions (8-K, 3 November 2026).
- The balance sheet holds cash. Marathon held $13.6 billion of cash and short-term investments at 30 September 2026, including $1.3 billion at MPLX. Of $33.0 billion of consolidated debt, $6.4 billion sits at Marathon and $26.6 billion at MPLX (8-K, 3 November 2026).
- The refinery sale captures peak-cycle value. CVR Energy agreed on 3 November 2026 to buy the St. Paul Park (105,000 barrels a day) and Mandan (72,000 barrels a day) refineries for about $4.2 billion. Marathon receives $3.45 billion and MPLX $750 million, with closing expected at year-end 2026, per CVR's filing.
- Most post-report targets sit above the price. Wells Fargo raised its target to $564 on 4 November 2026 and Morgan Stanley to $458 the same day. Goldman Sachs set $510 on 5 November 2026, and Piper Sandler raised its target to $466 on 5 November 2026.
Bear case
- A beat did not hold the shares. The shares closed at $392.68 on 4 November 2026 and $372.74 on 6 November 2026, the sessions after the report, according to adjusted daily closes.
- Fourth-quarter volumes are guided lower. Marathon guided fourth-quarter crude refined to 2,830 thousand barrels a day and total throughput to 3,080 thousand barrels a day. The third quarter ran at 2,973 and 3,150. Planned turnaround costs are $230 million (8-K, 3 November 2026).
- Targets are being cut after the report. BMO Capital cut its target to $450 from $535 on 11 November 2026, per company news. JPMorgan cut to $430 from $448 on 4 November 2026, and Goldman Sachs trimmed to $510 from $519 on 5 November 2026.
- Russian diesel is licensed through April. US Treasury General License 135 authorises Russian-origin diesel imports through 7 April 2027. Oilprice reported a plan for 500,000 tons in November, with the first cargo scheduled to reach New York on 7 November 2026.
- The group trades on spread headlines. Marathon fell 7.36% to $435.98 on 27 October 2026 in the refiners' worst session since April 2025, which Benzinga tied to Iran talks and Russian diesel supply.
Price setup
The shares closed at $402.84 on 11 November 2026, according to adjusted daily closes. That close is below the 50-day moving average of $422.88 and far above the 200-day average of $298.52, both as of that date. The three-month change is 13.3%.
After the report, closes ranged from a low of $372.74 on 6 November 2026 to $402.84 on 11 November 2026. The 11 November 2026 gain of 3.41% beat a 1.70% rise for the energy sector that day, per TradingKey. The 50-day average is the nearest level above the price. A sustained close back over it would show buying returning after the post-report fall.
The 52-week intraday high is $493.98, set on 19 October 2026, and the 52-week closing low is $162.63, set on 31 December 2025. The latest insider SEC Form 4 filings show only open-market sales by executives, at prices from $341.56 to $375.75 between 12 August 2026 and 31 August 2026. One was made under a Rule 10b5-1 plan, and none have been filed since.
Catalysts ahead
- 18 November 2026: Record date for the raised $1.10 quarterly dividend, payable 10 December 2026. First payout at the higher rate, confirming the board's cash-return commitment after the report.
- ~18 November 2026 (est.): EIA Weekly Petroleum Status Report. Distillate inventory draws would support management's view of elevated margins; builds alongside Russian imports would support the view that margins are peaking.
- ~31 December 2026 (est.): Expected closing of the St. Paul Park and Mandan refinery sale to CVR Energy. Closing brings Marathon $3.45 billion and MPLX $750 million in cash; a funding problem at CVR would trigger its reverse termination fee of up to $252 million.
- ~3 February 2027 (est.): Marathon Petroleum Q4 2026 results. Shows whether the refining margin holds near the third quarter's $45.70 a barrel and whether management keeps its view of elevated margins through mid-2027.
What would change the view
A daily close above $425, over the 50-day moving average of $422.88 as of 11 November 2026 and back above the level the shares broke on 4 November 2026, which would show the shares leading again. A fourth-quarter refining margin above the third quarter's $45.70 a barrel would also show it.
The line before it, a daily close below $420.00 set on 2 November 2026, was crossed on 4 November 2026: the shares closed at $392.68.
What it trades with
Marathon trades with the other large US refiners, Valero, Phillips 66 and PBF Energy, and with the CRAK refining exchange-traded fund. The 27 October 2026 sell-off hit the group together, per Benzinga. Diesel and gasoline crack spreads move the group more than crude prices do.
CVR Energy is now tied to Marathon through the pending sale. CVR disclosed on 3 November 2026 a reverse termination fee of up to $252 million if its funding falls short. It is financing the deal with $2.5 billion of committed secured debt, equity from Carl Icahn and Trafigura, and a $750 million share sale. Marathon consolidates MPLX, whose fee-based midstream earnings dampen the swing from refining margins compared with pure-play refiners.
The evidence, claim by claim (8)
- Marathon Petroleum reported a Q3 2026 refining and marketing margin of $45.70 per barrel versus $17.60 a year earlier, with 100% crude utilisation. Marathon Petroleum Q3 2026 results release (8-K) · as of
- Q3 2026 adjusted EPS was $26.93 versus $3.01 a year earlier; GAAP diluted EPS was $26.59 on $7.4 billion of net income. Marathon Petroleum Q3 2026 results release (8-K) · as of
- Q3 2026 revenue was $56.03 billion versus $34.81 billion in Q3 2025. Marathon Petroleum Q3 2026 10-Q · as of
- Q4 2026 guidance: crude refined 2,830 thousand barrels a day, total throughput 3,080 thousand barrels a day, planned turnaround costs $230 million, operating costs $5.60 per barrel. Marathon Petroleum Q3 2026 results release (8-K) · as of
- Marathon returned $3.3 billion to shareholders in Q3 2026 and authorised a new $5 billion buyback, bringing total authorisation to $8.1 billion. Marathon Petroleum Q3 2026 results release (8-K) · as of
- CVR Energy agreed to buy the St. Paul Park and Mandan refineries for about $4.2 billion: $3.45 billion to Marathon and $750 million to MPLX, with closing expected at year-end 2026. CVR Energy 8-K Exhibit 99.1 · as of
- BMO Capital cut its Marathon Petroleum price target to $450 from $535; JPMorgan cut to $430 from $448 on 4 November 2026. Company news (fiscal.ai, Benzinga analyst headlines) · as of
- Wells Fargo raised its Marathon Petroleum target to $564 from $560 and Morgan Stanley raised to $458, both keeping Overweight ratings. Benzinga analyst headlines · as of
Sources
- Marathon Petroleum Corp - Form 8-K - FY2026 · sec.gov
- Marathon Petroleum Corp - Form 10-Q - FY2026 · sec.gov
- CVR ENERGY INC - Form 8-K - FY2026 · sec.gov
- CVR Energy to acquire Midcontinent refineries from Marathon Petroleum in $4.2-billion deal · ogj.com
- Marathon Petroleum Corp Stock (MPC) Closed Up by 3.41% on Nov 11: Drivers Behind the Movement · tradingkey.com ·
- Refiner Stocks Post Worst Day Since April 2025 Tariff Shock · benzinga.com
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