Exxon Mobil Rises Despite Rare Sell Rating Downgrade
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2h ago
0mins
Should l Buy XOM?
Source: seekingalpha
- Rating Downgrade Impact: Despite BNP Paribas downgrading Exxon Mobil's rating from Neutral to Sell with a $125 price target, the stock rose 3.7% on Tuesday, indicating market confidence in its fundamentals.
- Attractive Cash Returns: Analysts noted that Exxon's cash return of approximately 6.6% is appealing in the current market, making it a favorable option for investors looking to hedge against oil price risks, even as its valuation faces challenges.
- Performance Analysis: While Q4 results modestly exceeded market expectations, analysts caution that as the exceptional rise in refining margins fades, profits are likely to normalize, with guidance for Product Solutions downtime suggesting added near-term pressure.
- Market Rebound Context: On Tuesday, crude oil futures rebounded from sharp declines in the previous session, leading to a rise in shares of most oil companies, with Exxon's performance reflecting the overall market recovery trend.
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Analyst Views on XOM
Wall Street analysts forecast XOM stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for XOM is 132.17 USD with a low forecast of 114.00 USD and a high forecast of 158.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
19 Analyst Rating
12 Buy
7 Hold
0 Sell
Moderate Buy
Current: 138.400
Low
114.00
Averages
132.17
High
158.00
Current: 138.400
Low
114.00
Averages
132.17
High
158.00
About XOM
Exxon Mobil Corporation is an energy provider and chemical manufacturer. The Company’s principal business involves exploration for, and production of, crude oil and natural gas; the manufacture, trade, transport and sale of crude oil, natural gas, petroleum products, petrochemicals and a wide variety of specialty products; and pursuit of lower-emission and other new business opportunities, including carbon capture and storage, hydrogen, lower-emission fuels, Proxxima systems, carbon materials, and lithium. Its Upstream segment explores for and produces crude oil and natural gas. The Energy Products, Chemical Products, and Specialty Products segments manufacture and sell petroleum products and petrochemicals. Energy Products segment includes fuels, aromatics, and catalysts and licensing. Chemical Products segment consists of olefins, polyolefins, and intermediates. Specialty Products segment includes finished lubricants, basestocks and waxes, synthetics, and elastomers and resins.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
ExxonMobil Achieves Industry-Leading Earnings in 2025
- Industry-Leading Performance: ExxonMobil achieved $28.8 billion in earnings and $52 billion in cash flow from operations in 2025, demonstrating the success of its transformational strategy and solidifying its leadership position in the oil sector.
- Production Capacity Innovation: The company reached its highest production volume of 4.7 million barrels of oil equivalent per day in over 40 years, driven by heavy investments in the Permian Basin and offshore Guyana, which not only boosted output but also enhanced competitiveness in high-margin areas.
- Increased Shareholder Returns: Exxon generated $26.1 billion in free cash flow last year, supporting $37.2 billion in cash distributions, including $17.2 billion in dividends, extending its growth streak to 43 consecutive years, showcasing its strong capability for shareholder returns.
- Future Growth Expectations: The company anticipates achieving $20 billion in structural cost savings by 2030 while continuing to invest heavily in its best assets, expecting to deliver $25 billion in earnings growth and $35 billion in cash flow growth, further enhancing shareholder return potential.
See More
Trump Administration May Ease Venezuela Oil Production Restrictions
- Investment Opportunity Unlocked: The Trump administration may issue a general license this week allowing companies to produce oil and gas in Venezuela, which would provide new investment opportunities for U.S. firms amid current economic sanctions.
- Chevron's Role: Currently, only Chevron is permitted to extract oil in Venezuela under a special license, and it is expected to ramp up production by 50% within 18 to 24 months upon receiving U.S. approvals, significantly enhancing its competitive position in the South American market.
- Mixed Industry Response: While the Trump administration is urging the oil industry to invest at least $100 billion to repair Venezuela's energy sector, ExxonMobil's CEO has stated that the country is 'uninvestable' under the current system, whereas smaller oil companies are showing greater enthusiasm for potential opportunities.
- Policy Context: The Venezuelan government recently passed reforms to ease state control over its oil industry, granting more autonomy to private companies, which could attract more foreign investment and further drive the country's economic recovery.
See More
Exxon Mobil Rises Despite Rare Sell Rating Downgrade
- Rating Downgrade Impact: Despite BNP Paribas downgrading Exxon Mobil's rating from Neutral to Sell with a $125 price target, the stock rose 3.7% on Tuesday, indicating market confidence in its fundamentals.
- Attractive Cash Returns: Analysts noted that Exxon's cash return of approximately 6.6% is appealing in the current market, making it a favorable option for investors looking to hedge against oil price risks, even as its valuation faces challenges.
- Performance Analysis: While Q4 results modestly exceeded market expectations, analysts caution that as the exceptional rise in refining margins fades, profits are likely to normalize, with guidance for Product Solutions downtime suggesting added near-term pressure.
- Market Rebound Context: On Tuesday, crude oil futures rebounded from sharp declines in the previous session, leading to a rise in shares of most oil companies, with Exxon's performance reflecting the overall market recovery trend.
See More
Geopolitical Tensions Resurface, Gold Rebounds
- Gold Price Surge: SPDR Gold Shares (GLD) surged over 6%, surpassing $4,950 per ounce, marking its strongest trading day since November 2008, primarily due to easing concerns over tighter Federal Reserve policies.
- Silver's Strong Rebound: Silver prices climbed nearly 9% to $86, recovering from a more than 30% plunge over the previous two sessions, indicating a resurgence in demand for precious metals that may attract more investors.
- Energy Market Reaction: Crude oil rose 1.8% to $63 a barrel after U.S. forces shot down an Iranian drone near a Navy aircraft carrier, reflecting the impact of geopolitical tensions on energy markets.
- Tech Stocks Underperform: The iShares Expanded Tech-Software Sector ETF fell 4.8%, marking its fifth consecutive daily decline, indicating waning market confidence in technology stocks, particularly in the software sector.
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- Stock Plunge: Sable Offshore Corp. shares fell over 10% on Tuesday after the company revealed it received subpoenas from the U.S. Attorney’s Office and SEC, indicating market concerns over potential legal risks.
- Funding Plan: The company entered into an agreement with TD Securities and Jefferies to sell up to $250 million of common stock through an at-the-market offering, highlighting the urgency to raise up to $200 million in equity by the end of 2025.
- Investigation Context: A report by Hunterbrook alleged that CEO Jim Flores privately disclosed multiple updates to select investors, including golfer Phil Mickelson, raising regulatory scrutiny over selective disclosure practices.
- Legal Challenge: California Attorney General Rob Bonta sued the Trump administration over the planned restart of two onshore oil pipelines owned by Sable, citing environmental risks and asserting state jurisdiction, which adds further legal and operational pressure on the company.
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- Significant Revenue Growth: The total revenue for the fourth quarter reached $13.79 billion, exceeding the consensus forecast of $12.36 billion, reflecting robust performance in pipeline transportation and services, further solidifying its market position.
- Consistent Distribution Growth: Distributions for 2025 increased by 3.6% year-over-year, marking the 27th consecutive year of distribution growth, which enhances investor confidence and attracts more long-term investors.
- Capital Investment Expansion: The company’s total capital investments for 2025 amounted to $5.6 billion, including a $632 million acquisition of Permian Basin assets, demonstrating its strong commitment to future growth.
See More
ExxonMobil Achieves Industry-Leading Earnings in 2025
- Industry-Leading Performance: ExxonMobil achieved $28.8 billion in earnings and $52 billion in cash flow from operations in 2025, demonstrating the success of its transformational strategy and solidifying its leadership position in the oil sector.
- Production Capacity Innovation: The company reached its highest production volume of 4.7 million barrels of oil equivalent per day in over 40 years, driven by heavy investments in the Permian Basin and offshore Guyana, which not only boosted output but also enhanced competitiveness in high-margin areas.
- Increased Shareholder Returns: Exxon generated $26.1 billion in free cash flow last year, supporting $37.2 billion in cash distributions, including $17.2 billion in dividends, extending its growth streak to 43 consecutive years, showcasing its strong capability for shareholder returns.
- Future Growth Expectations: The company anticipates achieving $20 billion in structural cost savings by 2030 while continuing to invest heavily in its best assets, expecting to deliver $25 billion in earnings growth and $35 billion in cash flow growth, further enhancing shareholder return potential.
See More
Trump Administration May Ease Venezuela Oil Production Restrictions
- Investment Opportunity Unlocked: The Trump administration may issue a general license this week allowing companies to produce oil and gas in Venezuela, which would provide new investment opportunities for U.S. firms amid current economic sanctions.
- Chevron's Role: Currently, only Chevron is permitted to extract oil in Venezuela under a special license, and it is expected to ramp up production by 50% within 18 to 24 months upon receiving U.S. approvals, significantly enhancing its competitive position in the South American market.
- Mixed Industry Response: While the Trump administration is urging the oil industry to invest at least $100 billion to repair Venezuela's energy sector, ExxonMobil's CEO has stated that the country is 'uninvestable' under the current system, whereas smaller oil companies are showing greater enthusiasm for potential opportunities.
- Policy Context: The Venezuelan government recently passed reforms to ease state control over its oil industry, granting more autonomy to private companies, which could attract more foreign investment and further drive the country's economic recovery.
See More
Exxon Mobil Rises Despite Rare Sell Rating Downgrade
- Rating Downgrade Impact: Despite BNP Paribas downgrading Exxon Mobil's rating from Neutral to Sell with a $125 price target, the stock rose 3.7% on Tuesday, indicating market confidence in its fundamentals.
- Attractive Cash Returns: Analysts noted that Exxon's cash return of approximately 6.6% is appealing in the current market, making it a favorable option for investors looking to hedge against oil price risks, even as its valuation faces challenges.
- Performance Analysis: While Q4 results modestly exceeded market expectations, analysts caution that as the exceptional rise in refining margins fades, profits are likely to normalize, with guidance for Product Solutions downtime suggesting added near-term pressure.
- Market Rebound Context: On Tuesday, crude oil futures rebounded from sharp declines in the previous session, leading to a rise in shares of most oil companies, with Exxon's performance reflecting the overall market recovery trend.
See More
Geopolitical Tensions Resurface, Gold Rebounds
- Gold Price Surge: SPDR Gold Shares (GLD) surged over 6%, surpassing $4,950 per ounce, marking its strongest trading day since November 2008, primarily due to easing concerns over tighter Federal Reserve policies.
- Silver's Strong Rebound: Silver prices climbed nearly 9% to $86, recovering from a more than 30% plunge over the previous two sessions, indicating a resurgence in demand for precious metals that may attract more investors.
- Energy Market Reaction: Crude oil rose 1.8% to $63 a barrel after U.S. forces shot down an Iranian drone near a Navy aircraft carrier, reflecting the impact of geopolitical tensions on energy markets.
- Tech Stocks Underperform: The iShares Expanded Tech-Software Sector ETF fell 4.8%, marking its fifth consecutive daily decline, indicating waning market confidence in technology stocks, particularly in the software sector.
See More
Sable Offshore Shares Plunge Amid Investigation and Stock Sale
- Stock Plunge: Sable Offshore Corp. shares fell over 10% on Tuesday after the company revealed it received subpoenas from the U.S. Attorney’s Office and SEC, indicating market concerns over potential legal risks.
- Funding Plan: The company entered into an agreement with TD Securities and Jefferies to sell up to $250 million of common stock through an at-the-market offering, highlighting the urgency to raise up to $200 million in equity by the end of 2025.
- Investigation Context: A report by Hunterbrook alleged that CEO Jim Flores privately disclosed multiple updates to select investors, including golfer Phil Mickelson, raising regulatory scrutiny over selective disclosure practices.
- Legal Challenge: California Attorney General Rob Bonta sued the Trump administration over the planned restart of two onshore oil pipelines owned by Sable, citing environmental risks and asserting state jurisdiction, which adds further legal and operational pressure on the company.
See More
Enterprise Products Partners Exceeds Q4 2025 Earnings Expectations
- Strong Financial Performance: Enterprise Products Partners reported a net income of $1.66 billion for Q4 2025, translating to 75 cents per unit, surpassing analyst expectations of 70 cents, indicating sustained profitability growth.
- Significant Revenue Growth: The total revenue for the fourth quarter reached $13.79 billion, exceeding the consensus forecast of $12.36 billion, reflecting robust performance in pipeline transportation and services, further solidifying its market position.
- Consistent Distribution Growth: Distributions for 2025 increased by 3.6% year-over-year, marking the 27th consecutive year of distribution growth, which enhances investor confidence and attracts more long-term investors.
- Capital Investment Expansion: The company’s total capital investments for 2025 amounted to $5.6 billion, including a $632 million acquisition of Permian Basin assets, demonstrating its strong commitment to future growth.
See More
