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Exxon Mobil: A Paragon Of Quality In These Difficult Times

May 06, 2020 2:16 PM ETExxon Mobil Corporation (XOM)32 Comments


  • Exxon Mobil recently revealed financial results for the first quarter of its 2020 fiscal year.
  • The company revealed the degree to which it has been hit and has hinted that the second quarter may be even worse.
  • Even so, the firm continues to demonstrate quality and stability.
  • Looking for a helping hand in the market? Members of Crude Value Insights get exclusive ideas and guidance to navigate any climate. Get started today »

Times are tough for oil and gas firms. This is true of all businesses in the industry, but one player that investors should keep a close eye on to understand the full impact of the recent downturn in energy prices and demand is Exxon Mobil (NYSE:XOM). As the large player in this market and with its hands in most major aspects of the oil and gas industry, Exxon should serve as a good barometer of what all is transpiring. More importantly for shareholders in it, the company just announced financial results for the first quarter of its 2020 fiscal year. With this announcement the firm granted shareholders a significant amount of information that shows a firm slowed down by, but far from stopped due to, the pain inflicted on the industry.

Some big changes

Tough times call for tough measures. Whether you’re a small E&P firm or a large, diversified behemoth like Exxon, this is always true. Nobody is spared from the pain caused by the COVID-19-inflicted economic fallout. Recognizing this pain, Exxon has done well to respond. But before we dig into these changes, we should first discuss where the firm stands today after its first quarter earnings release.

The quarter was something of a mixed bag for the company if you break it down by segment. On the whole, it was a lot of pain though. According to management, Exxon reported a loss of $610 million during the quarter. This was driven, in part, by the downturn in pricing in the oil and gas space, but another contributor was a $2.9 billion non-cash charge. A year earlier, the firm generated a gain of $2.35 billion. A better measure of the firm’s success might be cash flow. During the quarter, the firm saw operating cash flow of $6.27 billion. This excludes $86 million in net inflows associated with asset sales. By comparison, in the fourth quarter of last year, the company’s

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This article was written by

Daniel Jones profile picture
Robust cash flow analyses of oil and gas companies

Daniel is an avid and active professional investor. He runs Crude Value Insights, a value-oriented newsletter aimed at analyzing the cash flows and assessing the value of companies in the oil and gas space. His primary focus is on finding businesses that are trading at a significant discount to their intrinsic value by employing a combination of Benjamin Graham's investment philosophy and a contrarian approach to the market and the securities therein.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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