Wells Fargo updated its outlook for Marathon Petroleum (NYSE: MPC) on Wednesday, raising the firm s price target to $217.00 from $213.00 while maintaining an Overweight recommendation. The revised target implies roughly 16% potential upside from Marathon s then-current share price of $187.58, and the stock was trading near its 52-week high of $202.29.
The bank s revision follows Marathon s fourth-quarter 2025 earnings release. The company reported adjusted earnings per share of $4.07 for the quarter, a result that exceeded both consensus estimates of $2.72 and Wells Fargo s internal forecast of $2.53. The quarter also compared favorably to another published projection of $3.01, with the $4.07 EPS representing a 35.22% beat relative to that figure. On a trailing twelve-month basis, Marathon reported basic EPS of $13.27, which situates the company at a reported price-to-earnings ratio of 20.63.
Operationally, the refining business was a major contributor to the quarter s upside. Marathon s refining segment produced EBITDA of $1,997 million, well ahead of Wells Fargo s projection of $1,229 million. The firm attributed the outperformance to stronger throughput, sequentially improved capture rates and lower operating expenses. Turnaround costs in the period were recorded at $409 million, coming in below both analyst estimates and company guidance of $419 million and $420 million, respectively.
Despite these strengths, InvestingPro data cited in company analysis highlights relatively weak gross profit margins of 10.48% for Marathon, a metric that stands in contrast to the quarter s positive EBITDA dynamics.
Results across other segments were mixed. Marathon s midstream operating income was reported at $1.3 billion, which fell short of Wells Fargo s expectation of $1.5 billion. The Renewable Diesel business posted a $48 million loss in the quarter, a somewhat smaller shortfall than Wells Fargo s estimated loss of $55 million.
Capital allocation actions remained a focal point for management. Marathon repurchased $1 billion of shares in the fourth quarter, a level consistent with analyst expectations, and management commentary pointed to MPLX s intent to sustain 12.5% distribution growth over the next two years. Marathon also flagged an acceleration of growth capital expenditures beginning in 2026, which the company said will support its return-of-capital objectives.
InvestingPro materials referenced in the company s research package note that management has been active on buybacks while preserving a dividend that has been paid for 16 consecutive years; the dividend yield at the time was 2.13%. Additional analysis and Pro Research content were noted as available on InvestingPro for subscribers seeking a deeper view of Marathon s capital allocation strategy.
On top of Wells Fargo s update, other sell-side activity followed the earnings release. TD Cowen raised its price target on Marathon Petroleum to $198 from $183 and reiterated a Buy rating, with the firm s upgrade tied to refining gross margins aligning with historical capture rates. Marathon reported revenue of $33.42 billion for the quarter versus an anticipated $32.86 billion, producing a revenue surprise of 1.7%.
Overall, the combination of an EPS beat, stronger-than-expected refining EBITDA and a continued focus on share repurchases and distributions informed Wells Fargo s decision to lift its price target and sustain an Overweight stance. InvestingPro valuation indicators were cited as suggesting Marathon appears slightly undervalued on a Fair Value basis, according to the same data set.
Contextual note: The article reports the figures and analyst actions as presented in company and analyst disclosures. Where multiple analyst estimates are noted, each figure is reported as originally provided.