Intrinsic value of Murphy Oil - MUR

Previous Close

$26.37

  Intrinsic Value

$6.99

stock screener

  Rating & Target

str. sell

-73%

Previous close

$26.37

 
Intrinsic value

$6.99

 
Up/down potential

-73%

 
Rating

str. sell

We calculate the intrinsic value of MUR stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  -30.58
  2.50
  2.75
  2.97
  3.18
  3.36
  3.52
  3.67
  3.80
  3.92
  4.03
  4.13
  4.22
  4.29
  4.36
  4.43
  4.49
  4.54
  4.58
  4.62
  4.66
  4.70
  4.73
  4.75
  4.78
  4.80
  4.82
  4.84
  4.85
  4.87
  4.88
Revenue, $m
  1,909
  1,957
  2,011
  2,070
  2,136
  2,208
  2,286
  2,370
  2,460
  2,556
  2,659
  2,769
  2,886
  3,010
  3,141
  3,280
  3,427
  3,583
  3,747
  3,920
  4,103
  4,296
  4,499
  4,713
  4,938
  5,175
  5,424
  5,687
  5,963
  6,253
  6,559
Variable operating expenses, $m
 
  4,410
  4,532
  4,667
  4,815
  4,977
  5,152
  5,341
  5,544
  5,762
  5,994
  6,242
  6,505
  6,784
  7,080
  7,394
  7,725
  8,076
  8,446
  8,836
  9,248
  9,683
  10,140
  10,622
  11,130
  11,664
  12,227
  12,818
  13,440
  14,095
  14,783
Fixed operating expenses, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total operating expenses, $m
  2,219
  4,410
  4,532
  4,667
  4,815
  4,977
  5,152
  5,341
  5,544
  5,762
  5,994
  6,242
  6,505
  6,784
  7,080
  7,394
  7,725
  8,076
  8,446
  8,836
  9,248
  9,683
  10,140
  10,622
  11,130
  11,664
  12,227
  12,818
  13,440
  14,095
  14,783
Operating income, $m
  -310
  -2,454
  -2,521
  -2,596
  -2,679
  -2,769
  -2,866
  -2,972
  -3,085
  -3,206
  -3,335
  -3,472
  -3,619
  -3,774
  -3,939
  -4,113
  -4,298
  -4,493
  -4,699
  -4,916
  -5,145
  -5,387
  -5,642
  -5,910
  -6,192
  -6,489
  -6,802
  -7,131
  -7,478
  -7,842
  -8,224
EBITDA, $m
  744
  -1,373
  -1,411
  -1,453
  -1,499
  -1,549
  -1,604
  -1,663
  -1,726
  -1,794
  -1,866
  -1,943
  -2,025
  -2,112
  -2,204
  -2,302
  -2,405
  -2,514
  -2,629
  -2,751
  -2,879
  -3,014
  -3,157
  -3,307
  -3,465
  -3,631
  -3,806
  -3,990
  -4,184
  -4,388
  -4,602
Interest expense (income), $m
  128
  102
  107
  112
  119
  126
  133
  141
  150
  160
  170
  181
  193
  205
  218
  232
  247
  262
  279
  296
  314
  334
  354
  375
  398
  422
  447
  473
  501
  530
  561
Earnings before tax, $m
  -493
  -2,555
  -2,628
  -2,709
  -2,797
  -2,894
  -2,999
  -3,113
  -3,235
  -3,365
  -3,505
  -3,653
  -3,811
  -3,979
  -4,157
  -4,345
  -4,544
  -4,755
  -4,977
  -5,212
  -5,460
  -5,720
  -5,995
  -6,285
  -6,590
  -6,911
  -7,249
  -7,605
  -7,979
  -8,372
  -8,785
Tax expense, $m
  -219
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -276
  -2,555
  -2,628
  -2,709
  -2,797
  -2,894
  -2,999
  -3,113
  -3,235
  -3,365
  -3,505
  -3,653
  -3,811
  -3,979
  -4,157
  -4,345
  -4,544
  -4,755
  -4,977
  -5,212
  -5,460
  -5,720
  -5,995
  -6,285
  -6,590
  -6,911
  -7,249
  -7,605
  -7,979
  -8,372
  -8,785

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  984
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  10,296
  9,545
  9,807
  10,099
  10,420
  10,770
  11,150
  11,559
  11,999
  12,470
  12,972
  13,508
  14,077
  14,682
  15,323
  16,001
  16,719
  17,477
  18,278
  19,124
  20,015
  20,955
  21,946
  22,989
  24,087
  25,244
  26,461
  27,741
  29,088
  30,504
  31,993
Adjusted assets (=assets-cash), $m
  9,312
  9,545
  9,807
  10,099
  10,420
  10,770
  11,150
  11,559
  11,999
  12,470
  12,972
  13,508
  14,077
  14,682
  15,323
  16,001
  16,719
  17,477
  18,278
  19,124
  20,015
  20,955
  21,946
  22,989
  24,087
  25,244
  26,461
  27,741
  29,088
  30,504
  31,993
Revenue / Adjusted assets
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
  0.205
Average production assets, $m
  9,068
  9,294
  9,550
  9,834
  10,147
  10,488
  10,857
  11,256
  11,684
  12,142
  12,632
  13,153
  13,708
  14,296
  14,920
  15,581
  16,280
  17,019
  17,798
  18,622
  19,490
  20,405
  21,370
  22,385
  23,455
  24,581
  25,766
  27,013
  28,324
  29,703
  31,153
Working capital, $m
  57
  -366
  -376
  -387
  -399
  -413
  -427
  -443
  -460
  -478
  -497
  -518
  -540
  -563
  -587
  -613
  -641
  -670
  -701
  -733
  -767
  -803
  -841
  -881
  -923
  -968
  -1,014
  -1,063
  -1,115
  -1,169
  -1,226
Total debt, $m
  2,993
  2,539
  2,675
  2,825
  2,991
  3,171
  3,367
  3,579
  3,805
  4,048
  4,308
  4,584
  4,878
  5,190
  5,520
  5,871
  6,241
  6,632
  7,046
  7,482
  7,942
  8,427
  8,938
  9,476
  10,043
  10,640
  11,268
  11,928
  12,623
  13,354
  14,122
Total liabilities, $m
  5,379
  4,925
  5,061
  5,211
  5,377
  5,557
  5,753
  5,965
  6,191
  6,434
  6,694
  6,970
  7,264
  7,576
  7,906
  8,257
  8,627
  9,018
  9,432
  9,868
  10,328
  10,813
  11,324
  11,862
  12,429
  13,026
  13,654
  14,314
  15,009
  15,740
  16,508
Total equity, $m
  4,917
  4,620
  4,747
  4,888
  5,043
  5,213
  5,396
  5,595
  5,807
  6,035
  6,279
  6,538
  6,813
  7,106
  7,416
  7,745
  8,092
  8,459
  8,847
  9,256
  9,687
  10,142
  10,622
  11,127
  11,658
  12,218
  12,807
  13,427
  14,078
  14,764
  15,485
Total liabilities and equity, $m
  10,296
  9,545
  9,808
  10,099
  10,420
  10,770
  11,149
  11,560
  11,998
  12,469
  12,973
  13,508
  14,077
  14,682
  15,322
  16,002
  16,719
  17,477
  18,279
  19,124
  20,015
  20,955
  21,946
  22,989
  24,087
  25,244
  26,461
  27,741
  29,087
  30,504
  31,993
Debt-to-equity ratio
  0.609
  0.550
  0.560
  0.580
  0.590
  0.610
  0.620
  0.640
  0.660
  0.670
  0.690
  0.700
  0.720
  0.730
  0.740
  0.760
  0.770
  0.780
  0.800
  0.810
  0.820
  0.830
  0.840
  0.850
  0.860
  0.870
  0.880
  0.890
  0.900
  0.900
  0.910
Adjusted equity ratio
  0.422
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484
  0.484

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -276
  -2,555
  -2,628
  -2,709
  -2,797
  -2,894
  -2,999
  -3,113
  -3,235
  -3,365
  -3,505
  -3,653
  -3,811
  -3,979
  -4,157
  -4,345
  -4,544
  -4,755
  -4,977
  -5,212
  -5,460
  -5,720
  -5,995
  -6,285
  -6,590
  -6,911
  -7,249
  -7,605
  -7,979
  -8,372
  -8,785
Depreciation, amort., depletion, $m
  1,054
  1,081
  1,110
  1,144
  1,180
  1,219
  1,262
  1,309
  1,359
  1,412
  1,469
  1,529
  1,594
  1,662
  1,735
  1,812
  1,893
  1,979
  2,070
  2,165
  2,266
  2,373
  2,485
  2,603
  2,727
  2,858
  2,996
  3,141
  3,293
  3,454
  3,622
Funds from operations, $m
  607
  -1,475
  -1,517
  -1,565
  -1,618
  -1,675
  -1,737
  -1,804
  -1,876
  -1,954
  -2,036
  -2,124
  -2,217
  -2,317
  -2,422
  -2,534
  -2,651
  -2,776
  -2,908
  -3,047
  -3,193
  -3,348
  -3,511
  -3,682
  -3,863
  -4,053
  -4,253
  -4,464
  -4,685
  -4,918
  -5,163
Change in working capital, $m
  6
  -9
  -10
  -11
  -12
  -13
  -15
  -16
  -17
  -18
  -19
  -21
  -22
  -23
  -25
  -26
  -28
  -29
  -31
  -32
  -34
  -36
  -38
  -40
  -42
  -44
  -47
  -49
  -52
  -54
  -57
Cash from operations, $m
  601
  -1,466
  -1,507
  -1,554
  -1,605
  -1,661
  -1,722
  -1,788
  -1,859
  -1,935
  -2,017
  -2,103
  -2,196
  -2,294
  -2,397
  -2,508
  -2,624
  -2,747
  -2,877
  -3,014
  -3,159
  -3,312
  -3,473
  -3,642
  -3,821
  -4,009
  -4,206
  -4,414
  -4,633
  -4,864
  -5,106
Maintenance CAPEX, $m
  0
  -1,054
  -1,081
  -1,110
  -1,144
  -1,180
  -1,219
  -1,262
  -1,309
  -1,359
  -1,412
  -1,469
  -1,529
  -1,594
  -1,662
  -1,735
  -1,812
  -1,893
  -1,979
  -2,070
  -2,165
  -2,266
  -2,373
  -2,485
  -2,603
  -2,727
  -2,858
  -2,996
  -3,141
  -3,293
  -3,454
New CAPEX, $m
  -927
  -227
  -256
  -284
  -312
  -341
  -370
  -399
  -428
  -458
  -490
  -521
  -554
  -589
  -624
  -661
  -699
  -739
  -780
  -823
  -868
  -915
  -964
  -1,016
  -1,070
  -1,126
  -1,185
  -1,247
  -1,311
  -1,379
  -1,450
Cash from investing activities, $m
  286
  -1,281
  -1,337
  -1,394
  -1,456
  -1,521
  -1,589
  -1,661
  -1,737
  -1,817
  -1,902
  -1,990
  -2,083
  -2,183
  -2,286
  -2,396
  -2,511
  -2,632
  -2,759
  -2,893
  -3,033
  -3,181
  -3,337
  -3,501
  -3,673
  -3,853
  -4,043
  -4,243
  -4,452
  -4,672
  -4,904
Free cash flow, $m
  887
  -2,747
  -2,844
  -2,948
  -3,061
  -3,182
  -3,312
  -3,449
  -3,596
  -3,753
  -3,918
  -4,094
  -4,280
  -4,476
  -4,684
  -4,903
  -5,135
  -5,379
  -5,636
  -5,907
  -6,193
  -6,493
  -6,810
  -7,143
  -7,493
  -7,862
  -8,250
  -8,657
  -9,086
  -9,536
  -10,010
Issuance/(repayment) of debt, $m
  -69
  116
  135
  151
  166
  181
  196
  211
  227
  243
  259
  276
  294
  312
  331
  350
  370
  391
  413
  436
  460
  485
  511
  538
  567
  597
  628
  661
  695
  731
  768
Issuance/(repurchase) of shares, $m
  0
  2,672
  2,755
  2,850
  2,953
  3,064
  3,183
  3,311
  3,448
  3,593
  3,748
  3,913
  4,087
  4,272
  4,467
  4,674
  4,892
  5,122
  5,365
  5,621
  5,891
  6,175
  6,475
  6,790
  7,122
  7,471
  7,838
  8,224
  8,630
  9,057
  9,506
Cash from financing (excl. dividends), $m  
  -84
  2,788
  2,890
  3,001
  3,119
  3,245
  3,379
  3,522
  3,675
  3,836
  4,007
  4,189
  4,381
  4,584
  4,798
  5,024
  5,262
  5,513
  5,778
  6,057
  6,351
  6,660
  6,986
  7,328
  7,689
  8,068
  8,466
  8,885
  9,325
  9,788
  10,274
Total cash flow (excl. dividends), $m
  797
  41
  47
  52
  57
  62
  67
  73
  78
  84
  89
  95
  101
  107
  114
  121
  128
  135
  142
  150
  159
  167
  176
  186
  195
  206
  216
  228
  239
  252
  265
Retained Cash Flow (-), $m
  390
  -2,672
  -2,755
  -2,850
  -2,953
  -3,064
  -3,183
  -3,311
  -3,448
  -3,593
  -3,748
  -3,913
  -4,087
  -4,272
  -4,467
  -4,674
  -4,892
  -5,122
  -5,365
  -5,621
  -5,891
  -6,175
  -6,475
  -6,790
  -7,122
  -7,471
  -7,838
  -8,224
  -8,630
  -9,057
  -9,506
Prev. year cash balance distribution, $m
 
  414
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  -2,217
  -2,708
  -2,798
  -2,896
  -3,002
  -3,116
  -3,238
  -3,369
  -3,510
  -3,659
  -3,817
  -3,986
  -4,164
  -4,353
  -4,553
  -4,764
  -4,987
  -5,223
  -5,471
  -5,733
  -6,008
  -6,299
  -6,605
  -6,926
  -7,265
  -7,622
  -7,997
  -8,391
  -8,805
  -9,241
Discount rate, %
 
  5.70
  5.99
  6.28
  6.60
  6.93
  7.27
  7.64
  8.02
  8.42
  8.84
  9.28
  9.75
  10.24
  10.75
  11.29
  11.85
  12.44
  13.06
  13.72
  14.40
  15.12
  15.88
  16.67
  17.51
  18.38
  19.30
  20.27
  21.28
  22.34
  23.46
PV of cash for distribution, $m
 
  -2,097
  -2,411
  -2,330
  -2,243
  -2,147
  -2,044
  -1,934
  -1,818
  -1,695
  -1,568
  -1,438
  -1,305
  -1,173
  -1,043
  -916
  -794
  -679
  -573
  -476
  -389
  -312
  -246
  -190
  -144
  -107
  -77
  -55
  -38
  -25
  -17
Current shareholders' claim on cash, %
  100
  61.4
  37.6
  23.0
  14.0
  8.5
  5.2
  3.1
  1.9
  1.1
  0.7
  0.4
  0.2
  0.2
  0.1
  0.1
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0
  0.0

Murphy Oil Corporation (Murphy) is an oil and gas exploration and production company. The Company's exploration and production business explores for and produces crude oil, natural gas and natural gas liquids across the world. Its exploration and production activities are subdivided into four geographic segments: the United States, Canada, Malaysia and all other countries. It explores for and produces crude oil, natural gas and natural gas liquids around the world. This business maintains upstream operating offices in several locations around the world, including Houston, Texas, Calgary, Alberta, and Kuala Lumpur, Malaysia. As of December 31, 2016, Murphy's principal exploration and production activities were conducted in the United States by Murphy Exploration & Production Company-USA (Murphy Expro USA), in Malaysia, Australia, Brunei, and Vietnam by Murphy Exploration & Production Company-International (Murphy Expro International) and its subsidiaries, and in Western Canada.

FINANCIAL RATIOS  of  Murphy Oil (MUR)

Valuation Ratios
P/E Ratio -16.5
Price to Sales 2.4
Price to Book 0.9
Price to Tangible Book
Price to Cash Flow 7.6
Price to Free Cash Flow -13.9
Growth Rates
Sales Growth Rate -30.6%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -63.6%
Cap. Spend. - 3 Yr. Gr. Rate -23.7%
Financial Strength
Quick Ratio 2
Current Ratio 0.1
LT Debt to Equity 49.3%
Total Debt to Equity 60.9%
Interest Coverage -3
Management Effectiveness
Return On Assets -1.9%
Ret/ On Assets - 3 Yr. Avg. -3.9%
Return On Total Capital -3.4%
Ret/ On T. Cap. - 3 Yr. Avg. -6.1%
Return On Equity -5.4%
Return On Equity - 3 Yr. Avg. -9.2%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 70.7%
Gross Margin - 3 Yr. Avg. 73.3%
EBITDA Margin 36.1%
EBITDA Margin - 3 Yr. Avg. 13.7%
Operating Margin -16.2%
Oper. Margin - 3 Yr. Avg. -39.6%
Pre-Tax Margin -25.8%
Pre-Tax Margin - 3 Yr. Avg. -40.5%
Net Profit Margin -14.5%
Net Profit Margin - 3 Yr. Avg. -26.7%
Effective Tax Rate 44.4%
Eff/ Tax Rate - 3 Yr. Avg. 31.3%
Payout Ratio -75%

MUR stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the MUR stock intrinsic value calculation we used $1909 million for the last fiscal year's total revenue generated by Murphy Oil. The default revenue input number comes from 2016 income statement of Murphy Oil. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our MUR stock valuation model: a) initial revenue growth rate of 2.5% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 5.7%, whose default value for MUR is calculated based on our internal credit rating of Murphy Oil, is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of Murphy Oil.
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of MUR stock the variable cost ratio is equal to 225.4%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $0 million in the base year in the intrinsic value calculation for MUR stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 4.2% for Murphy Oil.

Corporate tax rate of 27% is the nominal tax rate for Murphy Oil. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the MUR stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for MUR are equal to 475%.

Life of production assets of 8.6 years is the average useful life of capital assets used in Murphy Oil operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for MUR is equal to -18.7%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $4917 million for Murphy Oil - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 175.845 million for Murphy Oil is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of Murphy Oil at the current share price and the inputted number of shares is $4.6 billion.

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XOM Exxon Mobil 77.53 22.27  str.sell
MRO Marathon Oil 15.54 5.09  str.sell
MPC Marathon Petro 66.81 323.84  str.buy
HES Hess Corp. 47.87 10.93  str.sell

COMPANY NEWS

▶ Murphy Oil Corporation Announces CFO Intention to Retire   [Feb-12-18 04:57PM  Business Wire]
▶ Murphy Oil Corporation Announces Dividend   [Feb-07-18 11:08AM  Business Wire]
▶ Murphy Oil reports 4Q loss   [Jan-31-18 06:11PM  Associated Press]
▶ How Oil Is Directing Oil-Weighted Stocks   [11:29AM  Market Realist]
▶ Which Oil-Weighted Stocks Are Outdoing Oils Gains?   [Jan-11-18 12:01PM  Market Realist]
▶ Which Oil-Weighted Stocks Could Be a Better Bet Than Oil?   [Dec-28-17 09:25AM  Market Realist]
▶ Analyzing Wall Street Targets for COP, MRO, MUR, DVN and EQT   [Dec-22-17 10:32AM  Market Realist]
▶ How Murphy Oils Free Cash Flow Is Trending   [07:33AM  Market Realist]
▶ Stocks With Rising Relative Strength: Murphy Oil   [03:00AM  Investor's Business Daily]
▶ How Increased Debt Affected Occidental Petroleums Leverage   [Dec-14-17 12:48PM  Market Realist]
▶ ETFs with exposure to Murphy Oil Corp. : December 5, 2017   [Dec-05-17 01:09PM  Capital Cube]
▶ ETFs with exposure to Murphy Oil Corp. : November 7, 2017   [Nov-07-17 10:31AM  Capital Cube]
▶ These 16 Stocks Look Ready to Reverse   [Nov-06-17 02:30PM  TheStreet.com]
▶ Murphy Oil Corp. to Host Earnings Call   [Nov-02-17 10:00AM  ACCESSWIRE]
▶ Murphy Oil reports 3Q loss   [Nov-01-17 05:15PM  Associated Press]
▶ Oil-Weighted Stocks Could Rise with US Crude Oil   [Oct-24-17 01:29PM  Market Realist]
▶ 3 Top Oil Stocks For October   [Oct-22-17 07:32AM  Motley Fool]
▶ Where Analysts Think Encana Could Trade in a Year   [Oct-11-17 09:11AM  Market Realist]
▶ Why Encana Stock Moved Last Week   [Oct-10-17 03:06PM  Market Realist]
▶ Murphy Oil Corporation Announces Dividend   [Oct-04-17 10:21AM  Business Wire]
▶ Auction of Brazil power plant rights fetches nearly $4B   [Sep-27-17 06:23PM  Associated Press]
▶ US Crude Oil: Oil-Weighted Stocks Could Rise   [Sep-26-17 01:21PM  Market Realist]
▶ Murchison Project Update for Brabant-McKenzie   [Sep-18-17 08:30AM  ACCESSWIRE]
▶ ConocoPhillips Stock Outperformed Oil and Natural Gas Prices   [Sep-12-17 10:47AM  Market Realist]
▶ Are Oil-Weighted Stocks Escaping Oils Weakness?   [Sep-05-17 02:18PM  Market Realist]
▶ Oil-Weighted Stocks Outperformed US Crude Oil   [Aug-30-17 09:47AM  Market Realist]
▶ Murchison Minerals to be Featured on BNN   [Aug-28-17 08:30AM  ACCESSWIRE]
▶ How Crude Oil Prices Moved ConocoPhillipss Stock Price   [Aug-25-17 04:06PM  Market Realist]
▶ Are Oil-Weighted Stocks Falling More Than Oil Prices?   [Aug-23-17 07:38AM  Market Realist]
▶ What Wall Street Analysts Are Saying about Encana   [Aug-18-17 07:37AM  Market Realist]
▶ How These Oil-Weighted Stocks Correlate with Oil   [Aug-16-17 07:37AM  Market Realist]
Financial statements of MUR
Valuation of Stocks

The paper VALUATION OF STOCKS: The Quest for Intrinsic Value provides a detailed description of our valuation model and discloses the calculation algorithm.

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