On Wednesday analysts at Oppenheimer increased the price target on Marathon Oil Corporation (MRO). However, this new price target is said to be a bit conservative given the oil company’s attractive valuation and improving outlook.

Oppenheimer raised the price target on Marathon Oil from $35 to $40. This new target suggests a +23.8% upside to Wednesday’s closing price of $32.32. The firm also backed its “Outperform” rating.

Despite the initial price target increase, analyst Fadel Gheit said this target is a bit conservative and believes good execution and a bit of oil exploration success could send MRO stock way past the current $40 target.

“During the Opco-sponsored road show earlier this week, CEO Clarence Cazalot reiterated MRO’s business strategy of 5-7% annual production growth through oil-focused investments with superior returns, while maintaining capital discipline, financial flexibility, and one of the highest dividend yields among peers,” said Gheit.

Marathon Oil shares were flat during pre-market trading on Thursday. The stock is up +6.07% over the past year.

The Bottom Line
Shares of Marathon Oil (MRO) have a 2.04% dividend yield, based on last night’s closing stock price of $32.32. The stock has technical support in the $29-$30 price area. If the shares can firm up, we see overhead resistance around the $34-$35 price levels.

Marathon Oil Corporation (MRO) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.2 out of 5 stars.

Be sure to visit our complete recommended list of the Best Dividend Stocks, as well as a detailed explanation of our ratings system here.