From other sites
at Nasdaq.com (Fri, 9:41AM)
at CNBC.com (Fri, 8:24AM)
at Investor's Business Daily (Thu, 4:48PM)
at CNBC.com (Thu, 4:15PM)
at Zacks.com (Thu, 12:30PM)
at CNBC.com (Thu, 12:15PM)
at Zacks.com (Thu, 11:06AM)
at Nasdaq.com (Thu, 10:50AM)
at CNBC.com (Thu, 8:14AM)
at Zacks.com (Thu, 1:00AM)
- The relentless drop in oil prices continued Thursday after a brief respite.
- For an untold number of reasons I believe we are nowhere near the bottom in oil presently. Yet, there is light at the end of the tunnel.
- A flight to safety of oil and gas dividend growth investment dollars may begin to occur as the price of oil continues to plummet.
- Exxon Mobil should be the beneficiary of this potentially massive shift.
- XOM is a terrific, well-diversified energy name with strong fundamentals.
- But with oil crashing continuously, earnings will be negatively affected.
- The dividend is solid, and is a separate reason to potentially own the stock.
- I think earnings estimates are too high and that XOM is worth around $80 right now.
The 'Immense Opportunity' Is Not In Exxon, It's In Small-Cap Oil Stocks
- Oil prices may not go as low as some expect and, even if they do, they probably will quickly rebound.
- The global economy appears poised for long-term growth, and the recent drop in oil prices is only likely to increase oil consumption and economic activity.
- Many investors are buying Exxon shares due to a slight pullback in that stock, but the really immense opportunity appears to be in small-cap oil stocks.
- The relative strength in Exxon could be a sign that oil is not going to see a significant additional decline.
- Small-cap stocks that have strong balance sheets, significant hedges, and even multi-year contract backlogs are worth buying now.
- ExxonMobil has outperformed its U.S. peers Chevron and ConocoPhillips during the latest oil price crash.
- ExxonMobil's size and free cash flow strength make the company extraordinarily attractive for investors.
- The company is an excellent bet on normalizing oil prices in the long run.
- Shares of ExxonMobil now yield more than 3%.
Retirement Strategy: Selling Exxon Mobil Goes Against The Grain Of A Dividend Growth Investor
- Dividend growth investors can create wealth just by virtue of the increasing dividends from dividend aristocrat stocks.
- Not to buy a dividend aristocrat is perhaps the worst advice a dividend growth investor can get.
- There are 54 stocks that are dividend aristocrats. Owning them over the long term would have made you wealthy and I believe will continue to do so.
- While Exxon has outperformed over the past six months, now is the time to take profits and rotate out of its stock.
- Exxon has been unable to generate production growth despite a large capex budget, and free cash flow does not cover shareholder returns.
- At 14.9x earnings, Exxon's stock does not reflect the company's weak operating performance, and I would sell shares.
- Exxon Mobil's resource base is now higher than ever, at 90bn BOE.
- Disciplined investment is delivering higher margins and returns.
- Among its peers, XOM is the most resilient in the face of a falling crude oil price.
- 9% CAGR in free cash flow between 2014 and 2018 fully covers the dividend.
- Exxon Mobil and Chevron make for good long-term investments at current prices for a number of reasons.
- Energy demand is expected to rise in the future, and Exxon Mobil and Chevron are in excellent positions to accommodate this growing need with their vast reserves.
- Both companies have integrated business models, in which the downstream segment can provide a cushion for earnings in the face of lower oil prices.
- Both companies have a long history of earnings and dividend growth, strong balance sheets, and dividend yields that are currently at their highest levels in a long time.
Exxon Mobil: A Massive Buying Opportunity? Don't Drink The Kool-Aid
- There has been a tectonic shift in the oil patch as of late.
- The price of oil has sunk to multi-year lows on the back of news OPEC will not cut production and the incredible success of North American oil and gas production.
- Consequently, Exxon Mobil’s stock has taken a hit as of late. Several analysts have come out touting this is an excellent buying opportunity.
- I say not so fast. In the following article we will attempt to determine the truth regarding the opportunity Exxon Mobil offers dividend growth investors.
Time To Snap Up The Immense Opportunity In Exxon Mobil Corporation
- Unlike other U.S. oil companies, Exxon Mobil is uniquely positioned to weather low prices. The current share price slip is therefore a buy opportunity.
- Most U.S. producers have hedged at around $90 a barrel. When these arrangements expire, most producers will run out of business, considering that low crude prices are expected to persist.
- When this happens, a lot of investments will flee from shale producers to other more stable plays in the energy sector.
- Exxon Mobil’s profile makes it a prime candidate for the fleeing capital, suggesting strong demand for its shares in coming years.
- This is a multi-year opportunity that could see investors who get in now rewarded handsomely over the next half decade.
- As we have predicted in October 2013, oil prices have dropped substantially, along with the stock prices of most major oil companies.
- Exxon's current stock price decline is consistent with previous declines associated with crude oil sell-offs, while lower capital spending and improved margins will provide some cushion.
- At this juncture, additional major declines in crude oil prices are less likely, hence providing a buying opportunity in Exxon shares.
Exxon Mobil Valuation Analysis: Slightly Overvalued
- Going by a DCF analysis, a comparable company analysis, and a historical multiple analysis, Exxon appears to be overvalued based on its fundamentals.
- Given the recent drop in oil prices, the company still trades in line with its historical multiples and a turn above its comps' mean multiple.
- This analysis is meant to be illustrative for potential and current Exxon investors, as I derive a fair value for the company between $80-$84 per share.
- Exxon Mobil is a good long-term investment in a dividend growth stock.
- Exxon Mobil has shown considerable earnings per share surprise in each one of the last three quarters, and according to its historical valuation multiples, the stock is significantly undervalued.
- Exxon Mobil is generating strong cash flows and returns value to its shareholders by stock buyback and increasing dividend payments.
- Dividend Challenger Exxon Mobil yields 2.9% at a price of $95.11 and has a reasonable five-year CAGR of 9.7%. It trades at a discount of 5% to my fair value estimate.
- Along with other energy sector companies, XOM is challenged by a weaker commodity price environment.
- The company's aggressive share buybacks and its dividend commitments are not sufficiently covered by the free cash flow it is generating, which could inhibit future dividend growth.
- Exxon Mobil's shares are down 5% since the beginning of the year.
- Falling oil prices are the main reason why Exxon Mobil has performed poorly lately.
- With higher oil prices, I expect Exxon Mobil's shares to kick into gear.
- The energy company is still undervalued, and a purchase below $100 can make a lot of sense for long-term oriented investors.
Exxon Mobil Corporation, Currently Undervalued And A Strong Buy
- Exxon Mobil Corp., formed through the merger of Exxon and Mobil in late 1999, is the world's largest publicly owned integrated oil company.
- With a relentless pursuit of efficiency via technology and operational improvement, Exxon sets itself apart from other supermajors and has delivered higher returns on capital.
- On October 31, 2014, the company announced third-quarter 2014 earnings of $1.89 per share, up from $1.79 in the prior year's third quarter.
Dividend Zombies: Exxon - YDP Analysis & Fair Value Appraisal (Part 4)
- Dividend Zombies are income equities that have survived more than 100 years with unbroken and undiminished dividend distributions. These are the 8 income machines that can't be killed.
- This part 4 of an 8-part series, evaluates XOM fair value price, technical momentum trends, entry point, and a yield boost while lowering market risk using covered option writing.
- Exxon, at the November 7th close of $96.59 is 16.63% below fair value price for income investors. A soon expected dividend raise will increase the target to $117.55.
What Can We Learn From Exxon Mobil's Q3 Earnings Release?
- Exxon Mobil reported higher third quarter earnings per share thanks to improvements in downstream operations, lower taxes, asset sales, and a share count reduction.
- The company is working on a record 10 start-ups in 2014, with even more projects on tap in coming years.
- At 12 times earnings, a strong yield and buyback program, and dominance in a field that will always be in demand, Exxon Mobil makes for a fine long-term investment.
Exxon Mobil: Well Positioned In Uncertain Environment, But Valuation High
- XOM is ahead of its peers in mega projects delivery.
- The company also doesn’t plan to trim capex in the current commodity prices environment.
- The company is better positioned in the weak oil prices world but valuation remains high.
Yesterday, 3:49 PM
- Exxon Mobil (XOM +1.8%) says it successfully drilled its second shale oil and gas well this year at the Vaca Muerta deposit in Argentina.
- “Our second well is flowing at levels that make it one of the best in the formation and complements those obtained at our first well," XOM says.
- XOM has interests in ~900K acres in Vaca Muerta, and is among foreign energy companies including Chevron and Shell developing shale fields in the huge deposit that holds at least 23B barrels of oil.
Wed, Dec. 17, 2:20 PM
- New York Gov. Cuomo's administration says it will ban fracking statewide, citing health concerns and what it considers as limited economic benefits to drilling.
- NY's acting health commissioner said at a cabinet meeting in Albany today that studies on fracking’s effects on water, air and soil are inconsistent, incomplete and raise too many “red flags” for the state to allow it; the state Department of Environmental Conservation will now issue a legally-binding recommendation prohibiting fracking.
- The state has had a de facto moratorium on fracking for more than six years, so nothing really changes with today's decision.
- Parts of New York sit atop the gas-rich Marcellus shale formation, whose top producers include CHK, RRC, RDS.A, RDS.B, TLM, APC, ATLS, COG, CVX, CNX, EQT, EOG, XOM, WPX, XCO, CRZO, SWN, AR.
Wed, Dec. 17, 10:56 AM
- Ivory Coast's government says it has signed production sharing agreements with Exxon Mobil (XOM +3.2%) for two ultra-deepwater blocks in the Gulf of Guinea.
- The deal covers Ivory Coast's CI-602 and CI-603 blocks, which cover 3,874 sq. km and 5,543 sq. km respectively and vary in depth from 3K-4K meters.
- Ivory Coast is seeking investors for seven new ultra-deepwater blocks.
Tue, Dec. 16, 6:58 PM
- Fluor (NYSE:FLR) says it has started construction activities on a new delayed coker unit for Exxon Mobil (NYSE:XOM) to expand production capabilities at the latter's Antwerp refinery in Belgium.
- FLR says its responsibilities span the project's life cycle and include design, engineering, procurement, module fabrication, transportation, installation and construction.
- FLR booked the project into backlog for an undisclosed value earlier in 2014.
Tue, Dec. 16, 11:44 AM
- Exxon Mobil (XOM +2.1%), Suncor Energy (SU +6.9%) and ConocoPhillips (COP +4.8%) combine to offer $559M for exploration rights in the deepwater Flemish Pass, the largest-ever bid for a license in Canada’s Newfoundland and Labrador province.
- The region is where Statoil last year announced the huge Bay du Nord find, which is estimated to contain up to 600M barrels of light, sweet crude.
Mon, Dec. 15, 12:55 PM
- Summit Midstream Partners (SMLP -0.1%) agrees to build and operate a $400M gathering system servicing XTO Energy's natural gas production in southeastern Ohio, giving SMLP an operating presence in the Utica Shale.
- SMLP says the system will gather gas, compress it and deliver it to various points, including Regency Energy Partners' Utica Ohio River Trunkline project.
- XTO, an Exxon Mobil (NYSE:XOM) subsidiary, will serve as the anchor shipper and has committed ~29K acres to the project under a long-term, fee-based agreement.
Fri, Dec. 12, 11:55 AM
- The timing couldn't be worse for Mexico in lifting its 75 years of state monopoly in oil production, as plunging oil prices dim the chances that U.S. producers will move in with their fracking and horizontal drilling capabilities.
- Mexican offshore assets have drawn interest from oil majors from Exxon (NYSE:XOM) to Shell (RDS.A, RDS.B), but the question is how quickly producers will be willing to move into the higher-risk, more costly prospects in an environment of reduced investment budgets.
- Mexico’s oil regulator this week approved preliminary rules for the first round of bidding on 14 shallow-water oil blocks in July, two months behind the original timetable; the deputy energy minister said bidding terms may be changed for the Chicontepec formation, which holds more than 17B boe.
Thu, Dec. 11, 10:45 AM
- Investors in giant gas export terminals from Australia to Canada are facing the prospect of losing nearly $250B plowed into the projects during the past seven years, as weaker oil prices threaten to wipe out returns.
- Oil-linked pricing means LNG producers stand to get much less revenue than expected on delivery of their first shipments, and oil prices have fallen so low that U.S. shale gas producers with plans to export the usually cheaper fuel to Asia suddenly find themselves facing a much tougher competitive environment.
- LNG prices in Asia have sunk below $10/MMBtu, while most Australian LNG projects would need to sell the commodity for at least $12-$14 to break even; for example, the breakeven point for the $54B Gorgon project under construction by Chevron (NYSE:CVX), Exxon (NYSE:XOM) and Shell (RDS.A, RDS.B), is ~$17.7/MMBtu.
- Other relevant tickers: LNG, TOT, COP, CEO, FCG, GASL, OTCPK:BRGXF, OTCQX:BRGYY, OTCPK:STOSF
Wed, Dec. 10, 12:58 PM
- Energy stocks are slammed across the board as oil prices take another nosedive (I, II), with the losses heaviest on shares of small, U.S.-based oil and gas producers.
- “Financial leverage is being thrown out the window, and everything else is being purged as well,” says Simmons analyst Bill Herbert, who adds that cuts to production budgets in the coming year likely will mean more pain for oil service companies.
- Among the hardest-hit shares: TPLM -15.2%, CRK -12.4%, GDP -11.9%, NOG -9.5%, AREX -8.6%.
- Investors have been less quick to dump shares of integrated oil companies, but today they have been smacked too: XOM -2.8%, CVX -2.9%, COP -2.3%, BP -2%, RDS.A -2.2%, TOT -2.3%.
- Today's worst performers on the S&P 500 include OKE -8.2%, DNR -7.4%, NE -5.6%.
- Service companies also are down: SLB -2.6%, HAL -2.7%, WFT -6.6%, BHI -2%.
- ETFs: XLE, ERX, VDE, OIH, ERY, DIG, DUG, IYE, XES, IEZ, PXI, FENY, PXJ, RYE, FXN, DDG
Wed, Dec. 10, 10:37 AM
- Sinopec (SNP -1.4%) reportedly wants to sell some long-term liquefied natural gas import deals as a slowing Chinese economy and cheaper retail gas makes LNG imports unprofitable, signalling the end of a five-year boom fueled by rising Chinese demand.
- Reuters reports that SNP is planning to offload LNG from new export plants in Australia and potentially Papua New Guinea to BP, amid growing unease over the scale of an expansion that has seen the construction of 11 LNG import terminals since 2006 with plans for 25 more.
- SNP also may sell excess volumes coming from its stake in Exxon's (NYSE:XOM) Papua New Guinea LNG, in which it invested in 2009 when LNG prices were low but Chinese demand was expected to grow for decades to come.
Tue, Dec. 9, 6:20 PM
- North Dakota issues strict new oil standards that will require energy companies operating in the state to strip explosive gases from crude oil that shows a high vapor pressure reading, in an effort to make crude-by-rail transport safer.
- Under the new mandate, North Dakota oil can’t be transported unless it has a vapor pressure reading of 13.7 lbs./sq. in. or lower.
- The rule, which will take effect on April 1, 2015, is the first major move by regulators to address the role of gaseous, volatile crude oil in railroad accidents which have been linked to several fiery explosions, including one last year in Quebec that killed 47 people.
- Top Bakken producers: CLR, EOG, KOG, WLL, HES, XOM, OAS, NOG, EOX, MRO.
Tue, Dec. 9, 2:19 PM
- Global energy demand will rise 35% from 2010 to 2040, and renewable energy will be the fastest growing major energy source through 2040, Exxon Mobil (XOM -0.4%) says in its annual outlook on global energy.
- XOM sees renewable energies such as wind, solar and biofuels growing 6%/year on average through 2040, at which point they will make up ~4% of global energy demand, while emissions in the developed world surge 50%.
- North America is set to become a net exporter of oil and natural gas, and its production of unconventional will nearly triple by 2040, surpassing the combined output of Russia and the Caspian region as the largest gas-producing area, the report says.
Tue, Dec. 9, 10:58 AM
- ConocoPhillips' (COP +0.1%) move to cut next year's capital spending by 20%, including less on some large projects that are nearing completion, is a clear sign that big energy companies are taking a second look at their mega-projects costing billions of dollars as they face the fallout of declining oil prices, WSJ reports.
- Big companies seek out big projects in normal times, since they have the engineering expertise to develop fields beyond the grasp of smaller firms and need to keep adding reserves to offset production declines in mature areas, but oil at $63/bbl is not part of the equation; Shell (RDS.A +0.1%) says a new project must be able to break even at $70, and BP (BP -0.7%) says it uses a long-term planning price of ~$80 when considering new investments.
- Bernstein Research analyst Iain Pyle says companies will have to review big investments; if prices fail to rebound soon, “what we’re going to see is projects getting canceled.”
- Also: XOM -0.1%, CVX +0.2%.
Mon, Dec. 8, 12:30 PM
- M&A likely will become a bigger theme in the energy exploration and production sector in 2015, and Exxon Mobil (XOM -2%) is among companies rumored to be headed for a deal.
- XOM is said to be interested in BG Group (OTCPK:BRGXF, OTCQX:BRGYY); with XOM's long-term growth plans in Russia at risk in today’s environment, the company could use some new, exciting opportunities, and BG’s Brazilian assets or an E&P company’s U.S. shale prospects would fit the bill, WSJ's Liam Denning says.
- XOM may be spooked by its 2010 deal for XTO Energy, which helped cut its annual return on capital employed to 18% last year from 34% in 2008; BG's return on capital last year was ~10%.
- With XTO’s legacy still apparent, Denning says XOM needs a clear bargain price to sell a strategic deal to investors but the dismal outlook for oil prices could make it easier to do as next year unfolds.
- Earlier: Low price oil could lead to big mergers
Fri, Dec. 5, 6:28 PM
- The rout in oil prices has knocked $46M off the potential compensation for Nabors Industries (NYSE:NBR) CEO Anthony Petrello, the highest-paid oil executive in the U.S., whose future pay passed $100M in July but has fallen to $58M as shares in the company plunged 57% during the last five months.
- “The land rig sector, of which Nabors is the biggest, is facing some severe headwinds on the earnings and cash flow they will make," says Credit Suisse analyst James Wicklund.
- Petrello’s losses are almost twice as much as those of the next four highest-paid U.S. oil CEOs combined; Exxon’s (NYSE:XOM) Rex Tillerson, Conoco's (NYSE:COP) Ryan Lance, Schlumberger’s (NYSE:SLB) Paal Kibsgaard and Chevron's (NYSE:CVX) John Watson lost an average 19%, or ~$24M, of the value of their compensation since July 3, according to Bloomberg data.
Fri, Dec. 5, 5:38 PM
- The Eagle Ford shale formation in south Texas produced its billionth barrel of oil some time last month, according to analysts at research firm Wood Mackenzie.
- Eagle Ford now accounts for 16% of total U.S. oil production, and the firm forecasts E&P spending of $30.8B in the region next year, ~22% of the total $139.3B expected in U.S. onshore spending.
- Eagle Ford is widely considered the most profitable U.S. shale field, and many analysts speculate the break-even price for production to remain profitable is ~$50/bbl in much of the play.
- Top Eagle Ford producers include EOG, CHK, APC, MRO, BHP, APC, APA, BP, COG, CRZO, CWEI, CRK, COP, XOM, FST, GDP, HES, MTDR, MUR, NFX, PVA, PXD, ROSE, RDS.A, RDS.B, SN, SM, STO, SFY, TLM, ZAZA
XOM vs. ETF Alternatives
Exxon Mobil Corporation is engaged in energy, involving exploration for, and production of, crude oil and natural gas, manufacture of petroleum products and transportation and sale of crude oil, natural gas and petroleum products.
Other News & PR