On Monday, ExxonMobil (NYSE:XOM) retained its buy rating from TD Cowen, with a steady stock price target of $135.00. The firm's decision follows a revision of the company's second-quarter earnings per share (EPS) estimate, which was adjusted from $2.35 to $2.08 per share.
This change is based on the latest guidance from ExxonMobil, which includes factors such as increased depreciation, depletion, and amortization (DDA) related to Pioneer Natural Resources (NYSE:PXD) and a forecast of lower refining industry margins.
The updated EPS estimate by TD Cowen falls below the consensus, reflecting a more conservative outlook for ExxonMobil's financial performance in the second quarter of 2024. The analysis took into account that ExxonMobil's average share count for the second quarter was 2% less than what TD Cowen had initially projected. This reduction in the number of shares could have an impact on the EPS calculation.
Moreover, Pioneer Natural Resources' production and capital expenditures were both reported to be higher than expected. These developments are likely to be addressed for further details during ExxonMobil's upcoming earnings call, where the company will provide more insights into its operations and financial results.
Despite the lowered EPS estimate, the firm's confidence in ExxonMobil's stock remains unchanged, as evidenced by the reiteration of the buy rating and the price target of $135.00. This target suggests that TD Cowen continues to see value in the stock at the current levels.
Investors and stakeholders are anticipated to pay close attention to ExxonMobil's forthcoming earnings call for additional clarification on the company's operational performance and financial strategies moving forward.
In other recent news, Exxon Mobil (NYSE:XOM) anticipates a boost in its second-quarter upstream earnings due to changes in oil prices, potentially increasing earnings by $300 million to $700 million compared to the first quarter.
This follows the company's first-quarter results which concluded with $5.7 billion in upstream earnings. In line with regulatory requirements, Exxon Mobil has also disclosed its second-quarter earnings considerations through a filing with the Securities and Exchange Commission.
Recent developments also reveal that Exxon Mobil is under investigation by the U.S. Senate Budget Committee for potential collusion with OPEC, along with other major oil companies. Furthermore, an arbitration panel is nearing completion to resolve a dispute between Exxon Mobil and Chevron (NYSE:CVX) over the latter's $53 billion acquisition of Hess Corp (NYSE:HES).
A Goldman Sachs (NYSE:GS) client note indicates that hedge funds are accelerating their purchases of commodity-sensitive stocks, including Exxon Mobil. The energy and materials sectors were among the most bought categories, particularly oil and gas companies. These developments reflect the ongoing dynamics in the energy sector and the strategic maneuvers of Exxon Mobil.
InvestingPro Insights
As ExxonMobil (NYSE:XOM) prepares for its upcoming earnings call, insights from InvestingPro offer a deeper understanding of the company's financial health and market position. With a solid market capitalization of $440.28 billion and a trailing twelve-month P/E ratio of 12.66, ExxonMobil showcases its stability and value in the market. Moreover, the company's dividend yield stands at 3.35%, reflecting a consistent return to shareholders, bolstered by a 4.4% dividend growth in the last twelve months as of Q1 2024.
InvestingPro Tips highlight ExxonMobil's remarkable track record of raising its dividend for 41 consecutive years and maintaining those payments for 54 years, signaling a robust financial discipline and commitment to shareholders.
Moreover, with low price volatility, ExxonMobil presents as a potentially attractive option for investors seeking stability in their portfolio. For those interested in gaining further insights and tips, InvestingPro offers additional guidance on ExxonMobil, including its status as a prominent player in the Oil, Gas & Consumable Fuels industry and its ability to generate cash flows that can sufficiently cover interest payments.
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The company's financials also demonstrate a moderate level of debt and an operating income margin of 13.96% for the last twelve months as of Q1 2024. With analysts predicting profitability for the year and a proven track record over the past year, ExxonMobil appears to be navigating the challenges of the industry with strategic acumen.
As stakeholders look forward to the earnings call, these metrics and insights provide a valuable context for understanding ExxonMobil's current standing and future potential.
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