Marathon Petroleum Corp (NYSE:MPC)
Dividend Yield: 1.80%
PEG Ratio: 0.53
Forward P/E: 7.98
Marathon Petroleum Corp (NYSE:MPC) is the largest refiner in the Midwest and the fourth largest in the United States. Its 7 refineries have a daily capacity of 1.69 million barrels. The company operates 6,100 Marathon Petroleum Corp (NYSE:MPC) retail stations and 1,460 Speedway retail stations. Marathon also has interests in 8,300 miles of pipelines.
Marathon Petroleum Corp (NYSE:MPC) is also able to transport cheaper Canadian and Bakken shale oil to its refineries. In the past year, Marathon Petroleum Corp (NYSE:MPC) has spent $2.2 billion to expand its Detroit refinery and also bought BP plc (ADR) (NYSE:BP)‘s Texas City refinery for $2.4 billion. By making these investments, it’s obvious Marathon Petroleum Corp (NYSE:MPC) sees further profits ahead in the refining business.
Dividend Yield: 2.00%
PEG Ratio: 0.72
Forward P/E: 7.04
Valero Energy Corporation (NYSE:VLO)
operates 16 refineries and 10 ethanol plants in the United States, Canada, United Kingdom, and the Caribbean. Total refinery capacity is 3 million barrels per day.
Valero Energy Corporation (NYSE:VLO) continues to unlock value for shareholders by spinning off its retail gas stations into CST Brands Inc (NYSE:CST). The company also plans to spin-off its logistics and transportation business into an MLP. This spin-off will further boost shareholder value. Three of Valero Energy Corporation (NYSE:VLO)‘s refineries on the Gulf Coast are able to refine the light crude oil produced by the various shale formations. The ability to refine this cheaper oil will keep Valero Energy Corporation (NYSE:VLO)‘s margins running steady.
Dividend Yield: 1.40%
PEG Ratio: 0.78
Forward P/E: 9.11
Tesoro Corporation (NYSE:TSO) owns and operates 7 refineries in western United States with a combined capacity of 675,000 barrels per day.
The company also operates approximately 1,400 branded retail stations.
Tesoro Corporation (NYSE:TSO) is making key moves for shareholders with its planned $2.5 billion purchase of BP’s Carson City, California, refinery. This acquisition would make Tesoro Corporation (NYSE:TSO) the largest refiner in the Pacific Basin and operate about a quarter of California’s refining capacity. This will allow Tesoro Corporation (NYSE:TSO) to combine operations with its Wilmington, California, refinery. This acquisition is currently undergoing regulatory approval and the company expects the transaction to close in the second half of the year.
Foolish assessment
In looking at the financials and prospects of all four companies, they still look cheap. Even though all four have had a good run over the past year, I view the recent weakness as a buying opportunity with all of them having more upside potential.
The article These 4 Refiners Are Still Cheap originally appeared on Fool.com is written by Mark Yagalla.
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