ExxonMobil stock's Neutral rating maintained by Mizuho

Mizuho has maintained its Neutral rating on ExxonMobil shares (NYSE: NYSE:XOM) while keeping the price target unchanged at $130.00.

Following ExxonMobil's release of its third-quarter pre-earnings report, the firm acknowledged the company's earnings per share (EPS) range of $1.56 to $2.24, which aligns with the general market consensus.

ExxonMobil's third-quarter performance was impacted by challenges such as lower liquids pricing in its Upstream operations and reduced refining margins in the Energy Products segment, each contributing to an approximate $800 million decline compared to the second quarter of 2024. Nonetheless, these setbacks were partly mitigated by favorable timing effects and a change in scheduled maintenance that boosted the Energy Products division.

Additionally, the company experienced a combined increase in margins for Chemicals and Specialty Products, contributing an additional $200 to $300 million. As a result, the EPS estimate from Mizuho has been adjusted to $1.93 per share, up from the previous $1.73, reflecting these factors. The updated estimate sits slightly below the current consensus of $1.95 per share but surpasses the midpoint of the implied range provided by ExxonMobil's 8-K filing.

In other recent news, ExxonMobil's third-quarter 2024 performance has been under scrutiny. Goldman Sachs reaffirmed its Neutral rating on ExxonMobil's shares, despite the company's better-than-expected Chemicals results.

The firm noted that ExxonMobil's implied earnings per share (EPS) of approximately $1.92 fell slightly below both Goldman Sachs' projection of $2.01 and the FactSet consensus of around $1.96.

ExxonMobil also disclosed a predicted drop in third-quarter upstream earnings, ranging from $600 million to $1 billion, attributing this to changes in oil prices. Additionally, the company, along with other major energy firms, might need to borrow significant amounts to sustain shareholder returns due to a recent decline in oil prices, according to analysts from RBC Capital Markets.

InvestingPro Insights

ExxonMobil's financial health and market position remain robust, as evidenced by recent InvestingPro data. The company's market capitalization stands at an impressive $544.6 billion, reflecting its status as a major player in the oil and gas industry. With a P/E ratio of 14.62, ExxonMobil's stock appears reasonably valued compared to its earnings, which aligns with Mizuho's Neutral rating.

InvestingPro Tips highlight ExxonMobil's strong dividend history, having raised its dividend for 41 consecutive years and maintained payments for 54 years. This commitment to shareholder returns is further supported by a current dividend yield of 3.1%. The company's financial stability is underscored by its ability to cover interest payments with cash flows and operate with a moderate level of debt.

Despite challenges noted in the earnings pre-announcement, ExxonMobil's stock has shown resilience, trading near its 52-week high with a year-to-date total return of 25.75%. This performance, coupled with analysts' predictions of profitability for the current year, suggests that the company is navigating industry headwinds effectively.

For investors seeking a deeper understanding of ExxonMobil's financial position, InvestingPro offers 11 additional tips, providing a comprehensive analysis to inform investment decisions.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.