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Murphy Oil's (MUR) Strong Upstream Portfolios Bode Well

Zacks Equity Research

Murphy Oil Corporation’s MUR cost-saving initiatives and low-cost asset development are expected to boost its performance in the future.

We issued an updated research report on this Zacks Rank #3 (Hold) company. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The company has a trailing four-quarter positive earnings surprise of 31.98%, on average.

What’s Driving the Stock?

Murphy Oil possesses one of the best upstream portfolios among the domestic oil and natural gas integrated companies as well as independent E&P group. The company is pursuing steady E&P and development activities in the United States and other international locations.

In the past several months, the company is trying to transform through acquisitions, divestitures and oil-weighted discoveries. Focus on the development of high-margin liquid assets is evident from the production mix. During second-quarter 2019, the company completed accretive deepwater Gulf of Mexico acquisition for a cash consideration of $1.227 billion. In the third quarter, Murphy Oil completed the sale of Malaysian assets for $2 billion.

It has a long history of increasing the value of its shareholders, courtesy of steady cash flows. Since 2012, Murphy Oil returned $3.9 billion to its shareholders through buybacks and dividend payouts. Consistent performance enabled the company to reward its shareholders through regular dividend payouts.

However, a highly-competitive industry, stringent regulations and unfavorable foreign currency conversion rates are headwinds.

Price Performance

Shares of Murphy Oil have lost 51.5% in the past 12 months compared with the industry’s 51.1% decline.

Stocks to Consider

A few better-ranked stocks from the same sector are Bloom Energy Corporation BE, Devon Energy Corporation DVN and Noble Energy Inc. NBL. Bloom Energy sports a Zacks Rank #1(Strong Buy), while Devon Energy and Noble Energy hold a Zacks Rank #2 (Buy) at present.

The long-term earnings growth rate of Bloom Energy, Devon Energy and Noble Energy is pegged at 25%, 4.10% and 9%, respectively.

Bloom Energy, Devon Energy and Noble Energy have a trailing four-quarter positive earnings surprise of 75.40%, 60.57% and 144.15%, respectively, on average.

Zacks’ Single Best Pick to Double

From thousands of stocks, 5 Zacks experts each picked their favorite to gain +100% or more in months to come. From those 5, Zacks Director of Research, Sheraz Mian hand-picks one to have the most explosive upside of all.

This young company’s gigantic growth was hidden by low-volume trading, then cut short by the coronavirus. But its digital products stand out in a region where the internet economy has tripled since 2015 and looks to triple again by 2025.

Its stock price is already starting to resume its upward arc. The sky’s the limit! And the earlier you get in, the greater your potential gain.

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Noble Energy Inc. (NBL) : Free Stock Analysis Report
 
Murphy Oil Corporation (MUR) : Free Stock Analysis Report
 
Devon Energy Corporation (DVN) : Free Stock Analysis Report
 
Bloom Energy Corporation (BE) : Free Stock Analysis Report
 
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