Exxon Mobil Revenue Nearly Doubles in Q2; Target price $68

Exxon Mobil, a US multinational oil and gas entity, is expected to report its second-quarter earnings of $1.0 per share, representing year-over-year growth of more than 240%, compared to a loss of $0.70 per share in the same quarter a year ago.

The largest publicly traded oil company in the US is said to achieve revenue growth of more than 90% to about $63 billion. The company has surpassed earnings per share (EPS) in three of the last four quarters.

Exxon Mobil stocks are up more than 40% so far this year.

Comments from analysts

“The shares of Exxon Mobil have seen a 10% decline in the past month as benchmark prices fell on OPEC’s easing of production restrictions. The company is committed to maintaining a strong balance sheet and returning capital to shareholders in the coming years. Despite an uncertain supply-demand environment, the company’s second quarter results are likely to benefit from high benchmark prices, supporting deleveraging plans. Second quarter revenues are likely to grow by approximately 100% (yoy), resulting in a sharp increase in earnings from last year’s low,” Trefis analysts noted.

Exxon Mobil Stock Price Forecast

Sixteen analysts who gave stock ratings for Exxon Mobil in the last three months, the 12-month average price was forecasting $68.73 with a high forecast of $90.00 and a low forecast of $55.00.

The average price target represents a change of 18.05% from the last price of $58.22. Of those 16 analysts, according to Tipranks, seven rated seven “Buy”, eight “Hold” and one “Sell”.

Morgan Stanley gave the stock price forecast of $84 with a high of $100 in a bull scenario and $41 in the worst case scenario. The company gave an “Overweight” rating on the shares of the oil and gas company.

“Improving FCF outlook and dividend sustainability. With a more constructive outlook for commodity prices, lower capital expenditures and additional cash operating cost savings, the dividend will be covered in 2021 and average >100% over the next 5 years according to our estimates. Improving dividend sustainability supports yield compression for ExxonMobil (XOM) versus CVX,” said Devin McDermott, equity analyst at Morgan Stanley.

“Cost savings defend the dividend. ExxonMobil (XOM) spending plans for 2022-25 reduced from $30-35 billion to $20-25 billion, improving dividend sustainability and limiting further balance sheet impairment. Additionally, XOM targets $6 billion in structural operating cost cuts, which should put upward pressure on consensus FCF estimates.”

Several other analysts have also updated their stock outlook. Piper Sandler raised the price target from $63 to $69. Independent Research raised the price target from $55.00 to $56.00. Jefferies raised the stock price forecast to $58 from $55.

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