Exxon Mobil’s Revenue to Nearly Double in Q2; Target Price $68

Exxon Mobil, an American multinational oil and gas entity, is expected to report its second-quarter earnings of $1.0 per share, which represents year-over-year growth of over 240%, up from a loss of $0.70 per share seen in the same quarter a year ago.

The U.S. largest publicly traded oil company would post revenue growth of over 90% to around $63 billion. The company has beaten earnings per share (EPS) estimates in three of the last four quarters.

Exxon Mobil shares have surged more than 40% so far this year.

Analyst Comments

“The shares of Exxon Mobil have observed a 10% decline in the past month as benchmark prices declined due to the easing of production curtailments by OPEC. The company is committed to maintaining a strong balance sheet and returning capital to shareholders in the coming years. Despite an uncertain demand-supply environment, the company’s second-quarter results are likely to benefit from high benchmark prices, assisting deleveraging plans. The second-quarter revenues are likely to grow by around 100% (y-o-y) resulting in strong earnings expansion over last year’s depressed number,” noted analysts at Trefis.

Exxon Mobil Stock Price Forecast

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

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

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

“Improving FCF outlook and dividend sustainability. With a more constructive commodity price outlook, lower capital spending, and additional cash operating cost savings, the dividend is covered in 2021 and averages >100% over the next 5-years on our estimates. Improving dividend sustainability supports yield compression for Exxon Mobil (XOM) relative to CVX,” noted Devin McDermott, equity analyst at Morgan Stanley.

“Cost cuts defend the dividend. Exxon Mobil (XOM) reduced 2022-25 spending plans to $20-25 B from $30-35 B, improving dividend sustainability while limiting further pull on the balance sheet. Additionally, XOM is targeting $6 B in structural operating cost reductions which should put upward pressure on consensus FCF estimates.”

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

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