Murphy Oil (MUR) AI Stock Analysis

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Murphy Oil

(NYSE:MUR)

74Outperform

Murphy Oil's strong financial performance and undervaluation are key strengths, supported by robust profitability and an attractive dividend yield. However, technical analysis indicates a bearish trend, and operational challenges highlighted in the earnings call slightly offset the positives. The overall outlook remains positive, but attention to production issues and asset volatility is advised.

Positive Factors

Debt Management

MUR has successfully completed a tender offer for $520 million of its senior notes, indicating effective debt management.

Exploration Success

MUR announced an oil discovery at its Hai Su Vang-1X exploration well offshore Vietnam, which could support a future commercial development.

Share Buybacks

MUR repurchased $194mm worth of stock in 3Q, well in excess of FCF, indicating a strong commitment to return cash to shareholders.

Negative Factors

Commodity Realizations

The company is experiencing softness in NGL and gas realizations.

Earnings Estimates

The Q3'24 EPS estimate was lowered to $0.66 from $0.79 due to revised oil, gas, and NGL realizations and minor expense adjustments.

Production Guidance

Heavier and longer than expected maintenance/workover activity resulted in lower production guidance and higher operating costs.

Murphy Oil (MUR) vs. S&P 500 (SPY)

Market Cap

$2.98B

Dividend Yield5.87%

Average Volume (3M)3.89M

Price to Earnings (P/E)7.7

Beta (1Y)0.73

Revenue Growth-12.48%

EPS Growth-36.47%

CountryUS

Employees750

SectorEnergy

Sector Strength44

IndustryOil & Gas Exploration & Production

Share Statistics

EPS (TTM)2.69

Shares Outstanding142,716,060

10 Day Avg. Volume4,439,639

30 Day Avg. Volume3,894,804

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)1.29

Price to Cash Flow (P/CF)2.30

P/FCF Ratio2.20

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$32.53

Price Target Upside55.87% Upside

Rating ConsensusHold

Number of Analyst Covering15

Murphy Oil Business Overview & Revenue Model

Company DescriptionMurphy Oil Corporation (MUR) is an independent exploration and production company focused on the extraction of crude oil, natural gas, and natural gas liquids. Primarily operating in North America, the company engages in the exploration, development, and production of oil and natural gas resources. Murphy Oil's core assets are located in the United States, Canada, and offshore Gulf of Mexico, with additional interests in other international regions. The company is committed to sustainable practices and aims to responsibly manage its resources while delivering value to its stakeholders.

How the Company Makes MoneyMurphy Oil Corporation makes money primarily through the exploration, development, and production of oil and natural gas. The company's revenue is generated from the sale of these commodities in the global market. Key revenue streams include crude oil production, natural gas production, and the sale of natural gas liquids. Additionally, Murphy Oil's operations in different geographical regions allow it to capitalize on diverse market conditions and price fluctuations, contributing to its overall earnings. Strategic partnerships and joint ventures in various projects also play a role in enhancing the company's production capacity and financial performance. Factors such as commodity prices, production volume, and operational efficiency significantly impact Murphy Oil's revenue generation.

Murphy Oil Financial Statement Overview

Summary

Murphy Oil's financial statements show strong profitability and operational efficiency, with a high gross profit margin and robust revenue growth. The balance sheet is solid with manageable debt levels, although asset volatility is a concern. Cash flow stability has improved, presenting a positive outlook.

Income Statement

Very Positive

Murphy Oil shows strong profitability with a high gross profit margin of 99.8% and net profit margin of 7.5% TTM. Revenue growth has been robust, with a significant increase from 2019 to TTM 2024. EBIT and EBITDA margins also reflect strong operating efficiency, although there was a decline in revenue in 2022.

Balance Sheet

Positive

The balance sheet reflects a solid equity position, with an equity ratio of 55.3% TTM. The debt-to-equity ratio is reasonable at 0.39, indicating manageable debt levels. However, past fluctuations in total assets and liabilities warrant attention for potential volatility.

Cash Flow

Positive

Cash flow from operations remains strong, with a high operating cash flow to net income ratio. Free cash flow has improved significantly, with a notable growth rate, providing financial flexibility. However, previous years saw less stability in cash flows.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
3.03B	3.45B	4.22B	2.80B	1.75B
	Gross Profit
3.03B	2.62B	2.38B	1.28B	-8.01M
	EBIT
11.58M	1.04B	1.59B	1.02B	-293.14M
	EBITDA
1.25B	1.95B	2.44B	1.12B	-325.02M
	Net Income Common Stockholders
407.17M	661.56M	965.05M	48.75M	-1.26B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
423.57M	317.07M	492.00M	521.20M	310.60M
	Total Assets
9.67B	9.77B	10.31B	10.30B	10.62B
	Total Debt
2.07B	2.09B	2.79B	2.47B	2.99B
	Net Debt
1.64B	1.77B	2.29B	1.94B	2.68B
	Total Liabilities
4.33B	4.22B	5.16B	5.98B	6.23B
	Stockholders Equity
5.19B	5.36B	4.99B	4.32B	4.39B
Cash Flow		Free Cash Flow
1.73B	647.16M	1.05B	733.95M	-70.06M
	Operating Cash Flow
1.73B	1.75B	2.17B	1.42B	802.71M
	Investing Cash Flow
-908.16M	-998.68M	-1.11B	-417.71M	-859.02M
	Financing Cash Flow
-716.54M	-923.72M	-1.08B	-794.51M	39.71M

Murphy Oil Technical Analysis

Technical Analysis Sentiment

Negative

Last Price20.87

Price Trends

50DMA

26.11

Negative

100DMA

28.38

Negative

200DMA

31.97

Negative

Market Momentum

MACD

-1.51

Positive

RSI

36.96

Neutral

STOCH

23.22

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For MUR, the sentiment is Negative. The current price of 20.87 is below the 20-day moving average (MA) of 25.64, below the 50-day MA of 26.11, and below the 200-day MA of 31.97, indicating a bearish trend. The MACD of -1.51 indicates Positive momentum. The RSI at 36.96 is Neutral, neither overbought nor oversold. The STOCH value of 23.22 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for MUR.

Murphy Oil Peers Comparison

Overall Rating

UnderperformOutperform

Sector (57)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
MUR	74 Outperform	$2.98B	7.74	7.77%	5.87%	-12.48%	-36.47%
VIST	74 Outperform	$3.60B	7.67	33.30%	―	45.43%	16.98%
BSM	73 Outperform	$2.96B	12.21	23.12%	10.71%	-12.71%	-39.85%
SM	71 Outperform	$2.48B	3.25	19.62%	3.51%	13.33%	-2.72%
CRC	66 Neutral	$3.11B	7.43	13.06%	4.29%	5.12%	-47.76%
GPOR	58 Neutral	$3.00B	16.69	-13.60%	―	-11.68%	-123.15%
Sector *	57 Neutral	$7.57B	4.34	-4.83%	6.50%	-0.19%	-64.60%

* Energy Sector Average

Performance Comparison

MUR

Murphy Oil

20.87

-24.00

-53.49%

SM Energy

21.67

-27.90

-56.28%

BSM

Black Stone Minerals

14.01

-0.25

-1.75%

VIST

Vista Oil & Gas SAB de CV

38.15

-3.52

-8.45%

CRC

California Resources Corp

34.33

-19.05

-35.69%

GPOR

Gulfport Energy

167.82

14.36

9.36%

Murphy Oil Earnings Call Summary

Earnings Call Date: Jan 30, 2025 | % Change Since: -27.64% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Neutral

Murphy Oil demonstrated significant financial and exploration achievements, including debt reduction and a successful oil discovery, which are offset by operational challenges and production impacts. The company's liquidity position and increased shareholder returns are positive, but there are concerns about production issues and asset impairments.

Highlights

Debt Reduction Achievement

Murphy Oil achieved a 60% reduction in total debt since 2020, reaching the lowest net debt in over a decade at approximately $850 million by year-end 2024.

Successful Oil Discovery in Vietnam

Murphy Oil drilled an oil discovery at the Hai Su Vang-1X exploration well in Vietnam, achieving a flow test result of 10,000 barrels of oil per day from one reservoir.

Increased Shareholder Returns

In 2024, Murphy Oil repurchased $300 million worth of stock and announced an 8% increase in its quarterly cash dividend.

Strong Liquidity Position

Murphy Oil ended 2024 with $1.8 billion in liquidity, positioning the company well to achieve strategic priorities.

Positive Seismic Reprocessing in Côte d'Ivoire

Murphy completed a seismic reprocessing project in Côte d'Ivoire, preparing for a three-well exploration program in late 2025.

Lowlights

Production Impact from Mechanical Issues and Delays

Murphy Oil experienced production impacts due to a mechanical issue at an offshore well, an offshore rig delay, and revised completion design in the Eagle Ford shale.

Asset Impairment in the Gulf of Mexico

Murphy Oil recorded a $28 million asset impairment for a field in the Gulf of Mexico.

Fourth Quarter Production Decline

Murphy Oil produced 175,000 barrels of oil equivalent per day in Q4 2024, below expectations due to various operational challenges.

Company Guidance

In the fourth quarter of 2024, Murphy Oil Corporation provided guidance with several key metrics. The company reduced its total debt by approximately 60% since 2020, achieving its lowest net debt in over a decade at approximately $850 million by year-end 2024. Production for the year was 177,000 barrels of oil equivalent per day (boe/d), while the fourth quarter specifically saw production of 175,000 boe/d, including 85,000 barrels of oil per day. Murphy Oil also maintained an 11-year reserve life with 713 million barrels of oil equivalent in proved reserves and achieved an 83% reserve replacement ratio. The company repurchased $300 million in stock during the year and announced an 8% increase in its quarterly cash dividend, raising the annualized rate to $1.30 per share. Financially, Murphy Oil generated $629 million in fourth-quarter revenue, with an average realized oil price of $70 per barrel, and adjusted EBITDA of $321 million. The company's 2025 capital expenditures are projected between $1.135 billion and $1.285 billion, with a significant portion allocated to offshore assets and development projects.

Murphy Oil Corporate Events

Stock BuybackDividendsBusiness Operations and Strategy

Murphy Oil to Present at Scotiabank Energy Conference

Positive

Feb 25, 2025

Murphy Oil Corporation announced its participation in the 53rd Annual Scotiabank Global Energy Conference starting February 26, 2025, where management will host investor meetings. The company highlighted its strategic priorities, including reducing debt to its lowest level in over a decade, advancing exploration programs in Vietnam and Côte d’Ivoire, and increasing shareholder returns through share repurchases and dividend hikes. These initiatives underscore Murphy Oil’s commitment to financial discipline and enhancing shareholder value.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.