It's a Marathon, not a sprint...Marathon Oil is outperforming the market, sprinting up 104% YTD as it makes a magnificent comeback from its 50% tumble last year.
Marathon shares have more than doubled this year, making it one of the biggest gainers on the S&P 500 so far in 2021... though the company can't take all the credit. Oil prices have been on a crazy ride since last year, plummeting below zero (yes, actually turning negative) for the first time in history in April last year as demand evaporated due to the COVID pandemic and the world was left with loads of oil but not enough storage capacity. Producers were literally paying buyers to take stuff off their hands. Marathon Oil saw a 40% y-o-y contraction in revenue and a net loss of $1.4 billion in 2020. Sad times.
Since then though, both oil and the companies that sell it have seen a major rebound. Oil prices are back up to more than $70 per barrel, while the S&P 500 is up nearly 15% this year thanks in part to the same energy and financial stocks that barely made it through last year. Marathon Oil is now up 104% YTD, while competitors Occidental Petroleum (OXY) and Diamondback Energy (FANG)aren't far behind. Oil and Energy stocks have gained an average of 30.59% this year though, so Marathon is still outperforming the sector.
With analysts now saying that oil could reach $100 per barrel, this sector is one to watch.