Exxon Mobil’s Strong Cash Flow and Strategic Growth Outlook Prompt Buy Rating

In a report released today, Lloyd Byrne from Jefferies maintained a Buy rating on Exxon Mobil (XOM – Research Report), with a price target of $140.00.

Lloyd Byrne has given his Buy rating due to a combination of factors concerning Exxon Mobil’s financial performance and strategic positioning. Despite a miss in adjusted earnings per share (EPS) for the first quarter of 2024, which came in slightly below expectations, the company exhibited strong cash generation capabilities. This robust cash flow, supported by working capital and lower capital expenditures, resulted in a significant free cash flow (FCF) beat. The financial health suggested by this FCF allows for optimism about the company’s ability to manage its finances and potentially reward shareholders.

Furthermore, Byrne’s assessment likely takes into account the various operational aspects that are expected to drive Exxon Mobil’s future growth and profitability. Key focuses include developments in the Guyana region, refining and chemical margins, progress in the Permian Basin acquisition (PXD), improvements in US shale productivity, initiatives in low carbon sectors, and gas realizations. The commentary on expectations for the fiscal years 2023 to 2027 also provides a longer-term perspective on the company’s strategic direction, which Byrne may find reassuring for sustained performance.

According to TipRanks, Byrne is a top 100 analyst with an average return of 28.7% and a 65.80% success rate. Byrne covers the Energy sector, focusing on stocks such as Baker Hughes Company, EQT, and Exxon Mobil.

In another report released on April 18, Piper Sandler also assigned a Buy rating to the stock with a $145.00 price target.

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Exxon Mobil (XOM) Company Description:

Exxon Mobil Corp. engages in the exploration, development, and distribution of oil, gas, and petroleum products. It operates through the following segments: Upstream, Downstream and Chemical. The Upstream segment produces crude oil and natural gas. The Downstream segment manufactures and trades petroleum products. The Chemical segment offers petrochemicals. The company was founded by John D. Rockefeller in 1882 and is headquartered in Irving, TX.