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Assessing MPLX (MPLX) Valuation After Raymond James And JP Morgan Downgrades

Simply Wall St · 4d ago

Raymond James’ downgrade of MPLX (MPLX) to Market Perform, following JP Morgan’s earlier rating cut, has put fresh attention on the partnership’s reliance on M&A and portfolio moves for future growth.

See our latest analysis for MPLX.

The recent downgrades come after a softer patch for the shares, with a 6.52% 1 month share price decline and a mildly weaker year to date move. However, the 1 year total shareholder return of 17.89% and 5 year total shareholder return above 200% show that longer term momentum has been much stronger than recent trading suggests.

If analyst caution around MPLX has you reassessing your energy exposure, it could be a good moment to widen the lens and check out aerospace and defense stocks.

With MPLX trading at US$52.22 against an average analyst price target of US$57.08 and a value score of 5, the key question now is whether this discount signals an opportunity or if the market is already pricing in future growth.

Most Popular Narrative: 8.8% Undervalued

With MPLX closing at US$52.22 against a narrative fair value of about US$57.29, the current price sits below where this narrative framework lands.

The company's disciplined capital allocation, prioritizing mid-teens returns on investment, maintaining low leverage, and growing both organic and bolt-on projects, is described as positioning MPLX for continued mid-single-digit annual EBITDA growth and double-digit distribution increases, enhancing total capital returns to unitholders.

Read the complete narrative.

Curious how moderate growth assumptions still support a higher valuation? The narrative leans on steady revenue, firm margins, and a richer future earnings multiple. The exact mix of those inputs might surprise you.

Result: Fair Value of $57.29 (UNDERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, that upside story still depends on continued Permian volume strength and successful integration of recent deals. Weaker demand or disappointing returns could quickly challenge this narrative.

Find out about the key risks to this MPLX narrative.

Build Your Own MPLX Narrative

If you see the assumptions differently or prefer testing ideas against the data yourself, you can build a custom MPLX story in a few minutes with Do it your way.

A great starting point for your MPLX research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.

Looking for more investment ideas?

If MPLX has sharpened your thinking, do not stop here. Your next strong idea could be sitting in a corner of the market you have not checked yet.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.