Morgan Stanley analyst Devin McDermott has lowered the price target for Murphy Oil to $35 from the previous $37 while maintaining an Underweight rating on the stock. The adjustment reflects a revised outlook on the company's valuation and market performance.

The rating downgrade and target price reduction highlight concerns regarding Murphy Oil's ability to deliver returns relative to its sector peers. Investors holding the stock may face continued pressure as the new price target suggests limited upside potential from current levels.

Rating and Price Target Details

The Underweight stance indicates that Morgan Stanley expects Murphy Oil to underperform the broader market or its industry sector in the near term. The reduced price target further underscores the firm's cautious perspective on the energy company's financial trajectory.

Murphy Oil Corporation has announced an oil discovery at the Bubale-1X exploration well in Block CI-709, located approximately 40 miles offshore Côte d’Ivoire. The discovery underscores the prospectivity of the company's acreage in the region and validates its disciplined exploration approach. The well encountered 100 feet (30 meters) of net oil pay across two reservoirs, with preliminary assessment indicating high-quality light oil.

The Bubale-1X well was drilled to a total depth of 20,548 feet (6,263 meters) in 7,795 feet (2,376 meters) of water. It is the third and final well in Murphy’s current three-well exploration campaign in Côte d’Ivoire. Following these results, the company will move into the next phase of evaluation, with one well planned for the second half of 2026 to test the extent of the discovery.

Operational Details and Ownership

The Bubale-1X well was spud in late February 2026 by Murphy CI-709 Oil Co., Ltd., a subsidiary of Murphy Oil Corporation and operator of Block CI-709. The working interest in the block is split between Murphy Oil Corporation and its partner.

Eric Hambly, President and Chief Executive Officer of Murphy Oil Corporation, stated that early results reinforce the prospectivity of the company's Côte d’Ivoire acreage. He emphasized that the results underscore the value of a disciplined and consistent exploration approach. The immediate focus is advancing evaluation plans to define the discovery’s full potential.

Murphy Oil Corporation is an independent oil and natural gas company with a multi-basin onshore and offshore portfolio. The company’s operations include onshore assets in the Eagle Ford Shale, Tupper Montney and Kaybob Duvernay, as well as offshore assets in the Gulf of America and Canada.