Yahoo Finanza Marathon Oil Rallies As WTI Oil Tries To Settle Above $120
Key Insights
Marathon Oil stock moves to new highs amid strong demand for oil-related equities.
The stock is up by more than 90% year-to-date but stays cheap at just 7 forward P/E.
Oil markets remain bullish, which could push Marathon Oil stock to higher levels.
Marathon Oil Tests Multi-Year Highs
Shares of Marathon Oil gained strong upside momentum and moved to multi-year highs as traders rushed to buy oil stocks after WTI oil moved towards the $120 level.
Currently, Marathon Oil is trading at levels that were last seen back in 2014. It should be noted that all-time highs for the stock were reached in 2007.
The stock has performed extremely well in 2022 as analyst estimates kept moving higher at a robust pace. Currently, Marathon Oil is expected to report earnings of $4.81 per share in the current year and $4.29 per share in the next year so the stock is trading at roughly 7 forward P/E, which is cheap for the current market environment.
What’s Next For Marathon Oil Stock?
Marathon Oil stock will likely remain extremely sensitive to developments in the oil markets in the near term. While Marathon Oil is trading at an attractive 7 forward P/E, the stock may be hit by profit-taking if oil pulls back from current levels.
Traders who have invested in Marathon Oil stock at the start of this year have significant paper profits, so the desire to take some of these profits off the table should not be underestimated.
At the same time, current valuation levels remain attractive. Analyst estimates continue to move higher, serving as a material bullish catalyst for the stock. The start of the driving season, the end of lockdowns in China and new sanctions on Russian oil could serve as additional bullish catalysts for Marathon Oil stock.
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This article was originally posted on FX Empire
