Is MPLX Still Attractively Priced After Its Strong Multi Year Share Price Rally?

• Wondering if MPLX is still a smart buy after such a big run, or if most of the value has already been squeezed out of the stock? Here is what the numbers are really saying about its current price.
• Over the last week MPLX is up 2.2%, about 7.8% over the past month, and it has climbed 12.7% year to date, 19.4% over the last year, 121.1% over three years, and 280.3% over five years. That kind of track record often makes investors ask whether they are late to the party or right on time.
• Recently, MPLX has stayed in the spotlight as midstream energy infrastructure continues to attract capital and attention, especially as investors look for income and stability in a choppy rate environment. Broader optimism around energy logistics and pipeline capacity has helped support the share price, even as markets keep reassessing long term demand for hydrocarbons.
• Despite that strong performance, MPLX currently scores a 5/6 valuation score, which means our checks suggest it looks undervalued on five of six fronts. In the next sections we will unpack what each of those approaches says about fair value, then finish with a more holistic way of thinking about valuation that can be even more useful than any single model.

MPLX delivered 19.4% returns over the last year. See how this stacks up to the rest of the Oil and Gas industry.

Approach 1: MPLX Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow model estimates what a company is worth by projecting the cash it can generate in the future and discounting those cash flows back to today in dollar terms.

For MPLX, the latest twelve month free cash flow is about $4.9 billion, a substantial base that underpins its valuation. Analysts provide detailed forecasts for the next few years, and beyond that Simply Wall St extrapolates growth. This results in projected free cash flow of roughly $6.4 billion by 2035. Those future cash flows are then discounted using a 2 Stage Free Cash Flow to Equity model to reflect risk and the time value of money.

On this basis, the DCF model estimates an intrinsic value of about $123.28 per unit. Compared with the current market price, this implies the units trade at roughly a 55.5% discount to their calculated fair value, which is a sizable valuation gap for a mature midstream business.

Result: UNDERVALUED

Our Discounted Cash Flow (DCF) analysis suggests MPLX is undervalued by 55.5%. Track this in your watchlist or portfolio, or discover 908 more undervalued stocks based on cash flows.

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for MPLX.

Approach 2: MPLX Price vs Earnings

For profitable, established businesses like MPLX, the price to earnings ratio is a practical shorthand for how much investors are willing to pay for each dollar of current profits. It links directly to bottom line earnings, which ultimately fund dividends, buybacks, and reinvestment.

What counts as a fair PE depends on how quickly earnings are expected to grow and how risky those earnings are. Faster growth or lower risk tends to justify a higher multiple, while slower growth or higher uncertainty usually pulls it down. MPLX currently trades on about 11.6x earnings, below the broader Oil and Gas industry average of roughly 13.6x and well under the peer group average of about 19.9x. This suggests the market prices it more conservatively than many midstream names.

Simply Wall St’s Fair Ratio for MPLX is 20.0x, a proprietary estimate of the multiple the company might deserve given its growth outlook, margins, industry, size, and risk profile. Because it blends these fundamentals rather than relying on blunt peer comparisons, the Fair Ratio can be a more targeted benchmark. With MPLX’s actual PE of 11.6x sitting well below the 20.0x Fair Ratio, the shares may be undervalued on an earnings multiple basis.

Result: UNDERVALUED

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Upgrade Your Decision Making: Choose your MPLX Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let us introduce you to Narratives, an easy tool on Simply Wall St’s Community page that lets you describe your story for MPLX, turn that story into a concrete forecast for revenue, earnings and margins, link it to a fair value, and then compare that fair value with the current price to decide whether to buy, hold or sell. The platform keeps your Narrative dynamically updated as new news and earnings arrive. One investor might build a bullish MPLX Narrative that sees fair value closer to the high analyst target of about $64, based on strong Permian growth, rising exports and expanding margins. A more cautious investor might lean toward the low target near $51, emphasizing commodity volatility, contract roll off risk and overbuilding concerns. Both perspectives are captured, quantified and comparable in a consistent framework that keeps you focused on what you believe is likely rather than just what has happened to the price recently.

Do you think there's more to the story for MPLX? Head over to our Community to see what others are saying!

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.

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