Intrinsic value of MPLX LP - MPLX

Previous Close

$31.75

  Intrinsic Value

$233.64

stock screener

  Rating & Target

str. buy

+636%

Previous close

$31.75

 
Intrinsic value

$233.64

 
Up/down potential

+636%

 
Rating

str. buy

We calculate the intrinsic value of MPLX 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

Revenue (in 0001), $M
Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Variable cost ratio, %
Fixed operating expenses, $M
Interest rate on debt, %
Effective corporate tax rate, %
Production assets / Revenue, %
Life of production assets, yrs
Working capital / Revenue, %
Revenue / Adjusted assets
Adjusted equity ratio
Cash flow adjustment, % of Revenue
Book value of equity, $M
Shares outstanding, mln
Market capitalization, $bln 25.2

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
   2
   3
   4
   5
   6
   7
   8
   9
   10
   11
   12
   13
   14
   15
   16
   17
   18
   19
   20
   21
   22
   23
   24
   25
   26
   27
   28
   29
   30
   31

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  58.10
  52.79
  48.01
  43.71
  39.84
  36.36
  33.22
  30.40
  27.86
  25.57
  23.51
  21.66
  20.00
  18.50
  17.15
  15.93
  14.84
  13.86
  12.97
  12.17
  11.46
  10.81
  10.23
  9.71
  9.24
  8.81
  8.43
  8.09
  7.78
  7.50
Revenue, $m
  10,158
  15,520
  22,972
  33,013
  46,165
  62,948
  83,859
  109,350
  139,812
  175,565
  216,848
  263,825
  316,582
  375,141
  439,469
  509,489
  585,095
  666,163
  752,564
  844,174
  940,881
  1,042,591
  1,149,239
  1,260,787
  1,377,228
  1,498,590
  1,624,934
  1,756,354
  1,892,981
  2,034,974
Variable operating expenses, $m
  4,772
  7,132
  10,412
  14,832
  20,620
  28,008
  37,212
  48,431
  61,839
  77,576
  95,446
  116,123
  139,344
  165,119
  193,433
  224,252
  257,530
  293,213
  331,243
  371,565
  414,130
  458,898
  505,840
  554,938
  606,189
  659,607
  715,217
  773,062
  833,199
  895,698
Fixed operating expenses, $m
  827
  845
  864
  883
  902
  922
  942
  963
  984
  1,006
  1,028
  1,050
  1,074
  1,097
  1,121
  1,146
  1,171
  1,197
  1,223
  1,250
  1,278
  1,306
  1,335
  1,364
  1,394
  1,425
  1,456
  1,488
  1,521
  1,554
Total operating expenses, $m
  5,599
  7,977
  11,276
  15,715
  21,522
  28,930
  38,154
  49,394
  62,823
  78,582
  96,474
  117,173
  140,418
  166,216
  194,554
  225,398
  258,701
  294,410
  332,466
  372,815
  415,408
  460,204
  507,175
  556,302
  607,583
  661,032
  716,673
  774,550
  834,720
  897,252
Operating income, $m
  4,559
  7,543
  11,696
  17,299
  24,642
  34,018
  45,705
  59,955
  76,988
  96,983
  120,374
  146,652
  176,164
  208,925
  244,915
  284,091
  326,393
  371,753
  420,099
  471,359
  525,473
  582,387
  642,065
  704,485
  769,645
  837,558
  908,260
  981,804
  1,058,261
  1,137,723
EBITDA, $m
  5,967
  9,535
  14,500
  21,197
  29,973
  41,178
  55,143
  72,171
  92,524
  116,414
  144,003
  175,399
  210,660
  249,801
  292,800
  339,606
  390,146
  444,340
  502,100
  563,342
  627,993
  695,990
  767,289
  841,864
  919,711
  1,000,848
  1,085,317
  1,173,180
  1,264,525
  1,359,458
Interest expense (income), $m
  212
  723
  1,308
  2,147
  3,312
  4,883
  6,941
  9,566
  12,838
  16,826
  21,592
  27,185
  33,644
  40,993
  49,247
  58,408
  68,472
  79,426
  91,255
  103,938
  117,455
  131,787
  146,916
  162,829
  179,513
  196,965
  215,181
  234,168
  253,934
  274,494
  295,869
Earnings before tax, $m
  3,836
  6,235
  9,550
  13,986
  19,759
  27,078
  36,139
  47,117
  60,163
  75,391
  93,189
  113,008
  135,171
  159,678
  186,507
  215,618
  246,967
  280,499
  316,161
  353,905
  393,686
  435,471
  479,236
  524,972
  572,680
  622,377
  674,092
  727,870
  783,767
  841,854
Tax expense, $m
  1,036
  1,684
  2,578
  3,776
  5,335
  7,311
  9,757
  12,722
  16,244
  20,356
  25,161
  30,512
  36,496
  43,113
  50,357
  58,217
  66,681
  75,735
  85,363
  95,554
  106,295
  117,577
  129,394
  141,742
  154,624
  168,042
  182,005
  196,525
  211,617
  227,300
Net income, $m
  2,800
  4,552
  6,971
  10,210
  14,424
  19,767
  26,381
  34,396
  43,919
  55,036
  68,028
  82,496
  98,675
  116,565
  136,150
  157,401
  180,286
  204,764
  230,798
  258,350
  287,391
  317,894
  349,843
  383,230
  418,057
  454,335
  492,087
  531,345
  572,150
  614,553

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $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 assets, $m
  36,021
  55,037
  81,460
  117,066
  163,704
  223,219
  297,371
  387,764
  495,787
  622,570
  768,966
  935,550
  1,122,632
  1,330,289
  1,558,401
  1,806,698
  2,074,804
  2,362,280
  2,668,668
  2,993,526
  3,336,456
  3,697,132
  4,075,316
  4,470,875
  4,883,787
  5,314,149
  5,762,176
  6,228,206
  6,712,697
  7,216,222
Adjusted assets (=assets-cash), $m
  36,021
  55,037
  81,460
  117,066
  163,704
  223,219
  297,371
  387,764
  495,787
  622,570
  768,966
  935,550
  1,122,632
  1,330,289
  1,558,401
  1,806,698
  2,074,804
  2,362,280
  2,668,668
  2,993,526
  3,336,456
  3,697,132
  4,075,316
  4,470,875
  4,883,787
  5,314,149
  5,762,176
  6,228,206
  6,712,697
  7,216,222
Revenue / Adjusted assets
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
  0.282
Average production assets, $m
  23,465
  35,852
  53,065
  76,259
  106,640
  145,409
  193,713
  252,598
  322,966
  405,555
  500,920
  609,436
  731,305
  866,577
  1,015,174
  1,176,919
  1,351,569
  1,538,836
  1,738,424
  1,950,043
  2,173,434
  2,408,386
  2,654,742
  2,912,418
  3,181,397
  3,461,743
  3,753,597
  4,057,178
  4,372,785
  4,700,791
Working capital, $m
  -569
  -869
  -1,286
  -1,849
  -2,585
  -3,525
  -4,696
  -6,124
  -7,829
  -9,832
  -12,144
  -14,774
  -17,729
  -21,008
  -24,610
  -28,531
  -32,765
  -37,305
  -42,144
  -47,274
  -52,689
  -58,385
  -64,357
  -70,604
  -77,125
  -83,921
  -90,996
  -98,356
  -106,007
  -113,959
Total debt, $m
  24,216
  39,752
  61,340
  90,430
  128,533
  177,157
  237,739
  311,591
  399,845
  503,427
  623,032
  759,131
  911,977
  1,081,633
  1,268,001
  1,470,859
  1,689,902
  1,924,770
  2,175,089
  2,440,498
  2,720,671
  3,015,344
  3,324,320
  3,647,492
  3,984,841
  4,336,446
  4,702,485
  5,083,231
  5,479,060
  5,890,440
Total liabilities, $m
  29,429
  44,965
  66,553
  95,643
  133,746
  182,370
  242,952
  316,804
  405,058
  508,640
  628,245
  764,344
  917,190
  1,086,846
  1,273,214
  1,476,072
  1,695,115
  1,929,983
  2,180,302
  2,445,711
  2,725,884
  3,020,557
  3,329,533
  3,652,705
  3,990,054
  4,341,659
  4,707,698
  5,088,444
  5,484,273
  5,895,653
Total equity, $m
  6,592
  10,072
  14,907
  21,423
  29,958
  40,849
  54,419
  70,961
  90,729
  113,930
  140,721
  171,206
  205,442
  243,443
  285,187
  330,626
  379,689
  432,297
  488,366
  547,815
  610,571
  676,575
  745,783
  818,170
  893,733
  972,489
  1,054,478
  1,139,762
  1,228,424
  1,320,569
Total liabilities and equity, $m
  36,021
  55,037
  81,460
  117,066
  163,704
  223,219
  297,371
  387,765
  495,787
  622,570
  768,966
  935,550
  1,122,632
  1,330,289
  1,558,401
  1,806,698
  2,074,804
  2,362,280
  2,668,668
  2,993,526
  3,336,455
  3,697,132
  4,075,316
  4,470,875
  4,883,787
  5,314,148
  5,762,176
  6,228,206
  6,712,697
  7,216,222
Debt-to-equity ratio
  3.670
  3.950
  4.110
  4.220
  4.290
  4.340
  4.370
  4.390
  4.410
  4.420
  4.430
  4.430
  4.440
  4.440
  4.450
  4.450
  4.450
  4.450
  4.450
  4.450
  4.460
  4.460
  4.460
  4.460
  4.460
  4.460
  4.460
  4.460
  4.460
  4.460
Adjusted equity ratio
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183
  0.183

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  2,800
  4,552
  6,971
  10,210
  14,424
  19,767
  26,381
  34,396
  43,919
  55,036
  68,028
  82,496
  98,675
  116,565
  136,150
  157,401
  180,286
  204,764
  230,798
  258,350
  287,391
  317,894
  349,843
  383,230
  418,057
  454,335
  492,087
  531,345
  572,150
  614,553
Depreciation, amort., depletion, $m
  1,408
  1,992
  2,804
  3,898
  5,331
  7,160
  9,438
  12,216
  15,535
  19,431
  23,628
  28,747
  34,496
  40,876
  47,886
  55,515
  63,753
  72,587
  82,001
  91,983
  102,520
  113,603
  125,224
  137,378
  150,066
  163,290
  177,056
  191,376
  206,263
  221,735
Funds from operations, $m
  4,208
  6,544
  9,775
  14,108
  19,755
  26,927
  35,820
  46,612
  59,454
  74,467
  91,657
  111,243
  133,171
  157,441
  184,035
  212,917
  244,039
  277,351
  312,799
  350,333
  389,911
  431,497
  475,066
  520,608
  568,122
  617,625
  669,144
  722,721
  778,413
  836,289
Change in working capital, $m
  -209
  -300
  -417
  -562
  -737
  -940
  -1,171
  -1,427
  -1,706
  -2,002
  -2,312
  -2,631
  -2,954
  -3,279
  -3,602
  -3,921
  -4,234
  -4,540
  -4,838
  -5,130
  -5,416
  -5,696
  -5,972
  -6,247
  -6,521
  -6,796
  -7,075
  -7,360
  -7,651
  -7,952
Cash from operations, $m
  4,417
  6,844
  10,192
  14,670
  20,492
  27,866
  36,991
  48,039
  61,160
  76,469
  93,968
  113,873
  136,125
  160,721
  187,638
  216,838
  248,273
  281,890
  317,637
  355,464
  395,327
  437,193
  481,039
  526,855
  574,643
  624,421
  676,219
  730,081
  786,064
  844,240
Maintenance CAPEX, $m
  -700
  -1,107
  -1,691
  -2,503
  -3,597
  -5,030
  -6,859
  -9,137
  -11,915
  -15,234
  -19,130
  -23,628
  -28,747
  -34,496
  -40,876
  -47,886
  -55,515
  -63,753
  -72,587
  -82,001
  -91,983
  -102,520
  -113,603
  -125,224
  -137,378
  -150,066
  -163,290
  -177,056
  -191,376
  -206,263
New CAPEX, $m
  -8,625
  -12,387
  -17,213
  -23,195
  -30,381
  -38,769
  -48,304
  -58,884
  -70,368
  -82,589
  -95,365
  -108,516
  -121,869
  -135,272
  -148,597
  -161,746
  -174,649
  -187,268
  -199,587
  -211,619
  -223,391
  -234,951
  -246,357
  -257,675
  -268,979
  -280,346
  -291,854
  -303,582
  -315,607
  -328,006
Cash from investing activities, $m
  -9,325
  -13,494
  -18,904
  -25,698
  -33,978
  -43,799
  -55,163
  -68,021
  -82,283
  -97,823
  -114,495
  -132,144
  -150,616
  -169,768
  -189,473
  -209,632
  -230,164
  -251,021
  -272,174
  -293,620
  -315,374
  -337,471
  -359,960
  -382,899
  -406,357
  -430,412
  -455,144
  -480,638
  -506,983
  -534,269
Free cash flow, $m
  -4,908
  -6,650
  -8,711
  -11,027
  -13,486
  -15,933
  -18,173
  -19,982
  -21,123
  -21,354
  -20,527
  -18,271
  -14,491
  -9,046
  -1,835
  7,206
  18,108
  30,869
  45,463
  61,844
  79,952
  99,721
  121,079
  143,956
  168,286
  194,009
  221,075
  249,443
  279,081
  309,971
Issuance/(repayment) of debt, $m
  10,824
  15,536
  21,588
  29,090
  38,103
  48,623
  60,582
  73,852
  88,255
  103,582
  119,606
  136,099
  152,846
  169,656
  186,368
  202,859
  219,042
  234,868
  250,319
  265,409
  280,174
  294,672
  308,977
  323,172
  337,349
  351,605
  366,038
  380,747
  395,829
  411,380
Issuance/(repurchase) of shares, $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 from financing (excl. dividends), $m  
  10,824
  15,536
  21,588
  29,090
  38,103
  48,623
  60,582
  73,852
  88,255
  103,582
  119,606
  136,099
  152,846
  169,656
  186,368
  202,859
  219,042
  234,868
  250,319
  265,409
  280,174
  294,672
  308,977
  323,172
  337,349
  351,605
  366,038
  380,747
  395,829
  411,380
Total cash flow (excl. dividends), $m
  5,916
  8,886
  12,877
  18,063
  24,617
  32,691
  42,410
  53,869
  67,131
  82,227
  99,079
  117,828
  138,355
  160,609
  184,532
  210,065
  237,151
  265,737
  295,782
  327,252
  360,126
  394,393
  430,055
  467,128
  505,635
  545,615
  587,114
  630,190
  674,910
  721,350
Retained Cash Flow (-), $m
  -2,418
  -3,480
  -4,836
  -6,516
  -8,535
  -10,891
  -13,570
  -16,542
  -19,768
  -23,201
  -26,791
  -30,485
  -34,236
  -38,001
  -41,745
  -45,438
  -49,063
  -52,608
  -56,069
  -59,449
  -62,756
  -66,004
  -69,208
  -72,387
  -75,563
  -78,756
  -81,989
  -85,284
  -88,662
  -92,145
Prev. year cash balance distribution, $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 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
  3,499
  5,406
  8,041
  11,547
  16,082
  21,799
  28,840
  37,327
  47,363
  59,026
  72,288
  87,343
  104,119
  122,608
  142,788
  164,627
  188,087
  213,129
  239,713
  267,803
  297,370
  328,389
  360,848
  394,740
  430,072
  466,858
  505,125
  544,906
  586,248
  629,205
Discount rate, %
  10.00
  10.50
  11.03
  11.58
  12.16
  12.76
  13.40
  14.07
  14.77
  15.51
  16.29
  17.10
  17.96
  18.86
  19.80
  20.79
  21.83
  22.92
  24.07
  25.27
  26.53
  27.86
  29.25
  30.72
  32.25
  33.86
  35.56
  37.33
  39.20
  41.16
PV of cash for distribution, $m
  3,181
  4,428
  5,876
  7,450
  9,063
  10,604
  11,958
  13,020
  13,703
  13,955
  13,745
  13,134
  12,163
  10,919
  9,503
  8,018
  6,556
  5,193
  3,984
  2,957
  2,123
  1,473
  987
  638
  397
  238
  137
  76
  40
  20
Current shareholders' claim on cash, %
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0
  100.0

MPLX LP is a master limited partnership (MLP) formed by Marathon Petroleum Corporation (MPC) to own, operate, develop and acquire midstream energy infrastructure assets. The Company is engaged in the gathering, processing and transportation of natural gas; the gathering, transportation, fractionation, storage and marketing of natural gas liquids (NGLs), and the gathering, transportation and storage of crude oil and refined petroleum products. Its segments are Logistics and Storage (L&S), and Gathering and Processing (G&P). The L&S segment includes transportation and storage of crude oil, refined products and other hydrocarbon-based products. As of December 31, 2016, the G&P segment operated various natural gas gathering systems that had a combined 5,439 million cubic feet per day (mmcf/d) throughput capacity. As of December 31, 2016, its assets included infrastructure to support MPC, including approximately 2,900 miles of crude oil and refined product pipelines across nine states.

FINANCIAL RATIOS  of  MPLX LP (MPLX)

Valuation Ratios
P/E Ratio 44.8
Price to Sales 4.4
Price to Book 1
Price to Tangible Book
Price to Cash Flow 8.9
Price to Free Cash Flow 139.8
Growth Rates
Sales Growth Rate 169.4%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate 318.8%
Cap. Spend. - 3 Yr. Gr. Rate 62.3%
Financial Strength
Quick Ratio NaN
Current Ratio 0
LT Debt to Equity 48.9%
Total Debt to Equity 48.9%
Interest Coverage 2
Management Effectiveness
Return On Assets 2.8%
Ret/ On Assets - 3 Yr. Avg. 5.3%
Return On Total Capital 1.6%
Ret/ On T. Cap. - 3 Yr. Avg. 6.2%
Return On Equity 2.5%
Return On Equity - 3 Yr. Avg. 9.8%
Asset Turnover 0.2
Profitability Ratios
Gross Margin 54.8%
Gross Margin - 3 Yr. Avg. 55.8%
EBITDA Margin 38.8%
EBITDA Margin - 3 Yr. Avg. 39.9%
Operating Margin 19.6%
Oper. Margin - 3 Yr. Avg. 28%
Pre-Tax Margin 9.5%
Pre-Tax Margin - 3 Yr. Avg. 22.7%
Net Profit Margin 9.9%
Net Profit Margin - 3 Yr. Avg. 19.3%
Effective Tax Rate -4.9%
Eff/ Tax Rate - 3 Yr. Avg. -1.5%
Payout Ratio 9.8%

MPLX stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the MPLX stock intrinsic value calculation we used $6425 million for the last fiscal year's total revenue generated by MPLX LP. The default revenue input number comes from 0001 income statement of MPLX LP. 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 MPLX stock valuation model: a) initial revenue growth rate of 58.1% 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 10%, whose default value for MPLX is calculated based on our internal credit rating of MPLX LP, 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 MPLX LP.
    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 MPLX stock the variable cost ratio is equal to 48.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $809 million in the base year in the intrinsic value calculation for MPLX 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 5.4% for MPLX LP.

Corporate tax rate of 27% is the nominal tax rate for MPLX LP. 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 MPLX 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 MPLX are equal to 231%.

Life of production assets of 21.2 years is the average useful life of capital assets used in MPLX LP 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 MPLX is equal to -5.6%. 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 - $4174 million for MPLX LP - 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 794.180 million for MPLX LP 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 MPLX LP at the current share price and the inputted number of shares is $25.2 billion.

RELATED COMPANIES Price Int.Val. Rating
MPC Marathon Petro 59.81 160.72  str.buy
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