Why Marathon Petroleum Is Poised to Pull Back

Why Marathon Petroleum Is Poised to Pull Back

While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.

What: Shares of Marathon Petroleum slipped 2% this morning after Imperial Capital downgraded the oil refining giant from "outperform" to "in-line".

So what: Along with the downgrade, analyst Ann Kohler planted a price target of $73 on the stock, representing just 3% worth of upside to Friday's close. While contrarian investors might be attracted to the stock's decline since April, Kohler believes that Marathon's valuation remains pretty fair and leaves little room for appreciation.

Now what: While Imperial isn't crazy about Marathon's stock price, it continues to be bullish on the company's operating prospects going forward. "With $2.0bn in cash as of 9/30/13 and continued strong free cash flow generation, we believe MPC remains well positioned to invest in economic growth projects across its integrated system as well as return cash to shareholders," noted Imperial. "At its upcoming analyst meeting, which is scheduled for 12/4/13, we expect management will continue to stress a balanced approach for cash." So while the valuation isn't exactly dirt cheap, Marathon's still-attractive growth and dividend trajectory still make it a solid long-term opportunity.

More juicy income opportunities
Dividend stocks can make you rich. It's as simple as that. While they don't garner the notoriety of high-flying growth stocks, they're also less likely to crash and burn. And over the long term, the compounding effect of the quarterly payouts, as well as their growth, adds up faster than most investors imagine. With this in mind, our analysts sat down to identify the absolute best of the best when it comes to rock-solid dividend stocks, drawing up a list in this free report of nine that fit the bill. To discover the identities of these companies before the rest of the market catches on, you can download this valuable free report by simply clicking here now.

The article Why Marathon Petroleum Is Poised to Pull Back originally appeared on Fool.com.

Fool contributor Brian Pacampara has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Copyright © 1995 - 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

Originally published