22 Apr

ExxonMobil Stock Is Expected to Post the Lowest Gains

WRITTEN BY Maitali Ramkumar

ExxonMobil’s implied gains

ExxonMobil (XOM) stock has the lowest implied gains compared to Suncor Energy (SU), Total (TOT), Royal Dutch Shell (RDS.A), Chevron (CVX), and BP (BP).

ExxonMobil stock has 4% implied gains based on its mean target price. Suncor, Total, and Shell have higher implied gains of 27%, 23%, and 22%, respectively. Chevron and BP have implied gains of 16% and 10%, respectively.

ExxonMobil Stock Is Expected to Post the Lowest Gains

ExxonMobil stock has risen 2% in the past year due to the higher stock price in the first quarter. In the past year, analysts’ mean target price on ExxonMobil stock has fallen 2% to $84.6. ExxonMobil is the only stock that saw its mean target price fall in the past year.

ExxonMobil’s earnings estimate for 2019

Analysts expect ExxonMobil’s earnings to fall 11% in 2019. The company could see weaker upstream realizations due to lower crude oil prices. Most analysts lowered their oil price estimate for 2019 due to the fear of a supply glut in the global oil market. Although the concerns are waning with OPEC’s supply cuts, they haven’t fully vanished.

However, ExxonMobil has a strong upstream portfolio, which is expected to drive the company’s long-term growth. ExxonMobil has a healthy upstream projects pipeline. The company’s main projects are expected to be online by 2025, which will likely contribute ~50% to ExxonMobil’s upstream earnings. ExxonMobil expects its upstream earnings to triple by 2025—assuming oil prices of $60 per barrel.

ExxonMobil has an advantaged downstream portfolio with many ongoing projects. The company has a fully integrated model, which could optimize the value out of every molecule processed in its supply chain.

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