ExxonMobil price target raised to $128 from $120 at TD Cowen

Investing.com - TD Cowen raised its price target on ExxonMobil (NYSE:XOM) to $128.00 from $120.00 on Monday, while maintaining a Buy rating on the energy giant. The firm also reaffirmed ExxonMobil as a "Top Pick" in its coverage universe. With a market capitalization of $494 billion and a P/E ratio of 15.18x, InvestingPro analysis suggests the stock is currently trading below its Fair Value.

The price target increase was primarily driven by higher near-term earnings expectations, with TD Cowen’s valuation based on a net present value of free cash flow using 2030 as a terminal year. The research firm noted that ExxonMobil is differentiating itself from industry peers through technology deployment aimed at improving resource recovery and creating deal space. The company maintains strong financial health with an InvestingPro Financial Health Score of 2.82 (GOOD) and has raised its dividend for 42 consecutive years, currently yielding 3.45%.

TD Cowen highlighted several positive developments for ExxonMobil, including potential upside to synergies from the Pioneer Natural Resources (NYSE:PXD) acquisition. The firm also mentioned the possibility of a Hess Corporation (NYSE:HES) arbitration ruling before the standard 90-day timeframe expires. Technical indicators from InvestingPro suggest the stock is currently in overbought territory, though it generally trades with low price volatility.

The analyst report indicated that ExxonMobil’s Baytown hydrogen project remains contingent on regulations that would support the market. This reflects the company’s strategic approach to major capital investments.

TD Cowen suggested investors should consider ExxonMobil more like an industrial equity rather than a traditional oil and gas company, pointing to the company’s technological capabilities and strategic positioning in the energy sector.

In other recent news, ExxonMobil reported its first-quarter 2025 financial results, surpassing earnings per share (EPS) expectations with $1.76 compared to the forecasted $1.73. However, the company’s revenue fell short, recording $83.13 billion against an expected $86.09 billion. In another development, UBS analysts maintained their Buy rating for ExxonMobil with a price target of $130, citing the company’s strong asset base and strategic direction. Similarly, Evercore ISI reiterated an Outperform rating with a $120 price target, highlighting ExxonMobil’s strategic advantages and cost structure. Meanwhile, Union Investment has divested from ExxonMobil due to perceived insufficient commitment to climate targets. Additionally, the U.S. Energy Department canceled a $332 million award for a green energy project at ExxonMobil’s Baytown, Texas refinery. These developments reflect the company’s ongoing efforts in strategic investments and environmental initiatives amidst evolving market conditions.

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