Integrated stocks recover in 2016
In 2015, sinking oil prices affected the upstream earnings of integrated energy companies, which was duly reflected in their stock price performances. This trend continued in January 2016.
However, since January’s end, ExxonMobil’s (XOM) stock has been rising. This has likely been due to spikes in oil prices. Crude oil prices have risen, led by the efforts of oil producers to support prices, supply outages, and reductions across the globe. Since January 20, 2016, XOM’s stock, amid volatility, has risen by 22%.
XOM’s peers Total S.A. (TOT) and Eni (E) have risen by 11% and 9%, respectively, during the same period. Suncor Energy (SU) has risen even more sharply by 26%. The iShares U.S. Energy ETF (IYE) has ~44% exposure to integrated energy sector stocks.
XOM’s stock performance
Last year, XOM’s stock fell, led by plunging oil prices. Continuing the trend, XOM’s stock had a weak opening to 2016. ExxonMobil was trading below its 50-day and 200-day moving averages at the beginning of the year. Its downward movement halted at the end of January 2016, after which it started rising due to firming oil prices.
During the same period, XOM’s stock, amid volatility, crossed over its 50-day and 200-day moving averages. Currently, it’s trading above its 50-day and 200-day moving averages.
ExxonMobil’s latest earnings brief
ExxonMobil saw a fall in its earnings from $4.9 billion in 1Q15 to $1.8 billion in 1Q16. This was due to a fall in its upstream segment’s earnings. The company’s downstream segment also witnessed a fall, which was partly offset by a rise in its chemical segment’s earnings in the quarter.
In the next part, we’ll discuss analysts’ ratings for XOM.