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Here's Why Hold Strategy is Apt for ExxonMobil (XOM) Now
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Exxon Mobil Corporation (XOM - Free Report) is a leading integrated energy player. Over the past seven days, the firm, carrying a Zacks Rank #3 (Hold), has witnessed upward earnings estimate revisions for this year.
What's Favoring the Stock?
The price of West Texas Intermediate crude is currently higher than the $80-per-barrel mark. The positive trajectory in oil price is a boon for ExxonMobil’s upstream operations. ExxonMobil has a solid pipeline of profitable projects in the Permian Basin – the most prolific oil and gas resource in the United States – and offshore Guyana.
In Stabroek Block, located off the coast of Guyana, ExxonMobil has made many major discoveries that significantly improve its production outlook. The advantaged growth projects of Guyana have lower greenhouse gas intensity than most of the oil and gas-producing resources across the globe. Thus, in the upstream business front, it could be said that ExxonMobil’s prospects are solid.
XOM has a strong balance sheet, so it can withstand adverse business environments. XOM has a total debt-to-capitalization of 16.7%. Compared to the 24.7% debt-to-capitalization of composite stocks belonging to the industry, ExxonMobil is better off.
What’s Hurting it?
The upstream business of the integrated firm is highly exposed to volatility in oil and gas prices. Also, ExxonMobil is offering a lower dividend yield than the composite stocks belonging to the industry.
Stocks to Consider
Better-ranked players in the energy space include Evolution Petroleum Corporation (EPM - Free Report) , Profire Energy, Inc. (PFIE - Free Report) and Helix Energy Solutions Group, Inc. (HLX - Free Report) . While Evolution Petroleum and Profire Energy carry a Zacks Rank #2 (Buy), Helix Energy sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Profire Energy is mainly focused on the oil and gas industry’s upstream, midstream and downstream transmission segments. PFIE has boosted that its legacy business is doing extremely well, thanks to the resumption of maintenance work of exploration and production players.
Helix Energy is a leading player and is well-poised to grow in the favorable crude pricing environment since it primarily provides specialty services to the offshore energy industry.
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Here's Why Hold Strategy is Apt for ExxonMobil (XOM) Now
Exxon Mobil Corporation (XOM - Free Report) is a leading integrated energy player. Over the past seven days, the firm, carrying a Zacks Rank #3 (Hold), has witnessed upward earnings estimate revisions for this year.
What's Favoring the Stock?
The price of West Texas Intermediate crude is currently higher than the $80-per-barrel mark. The positive trajectory in oil price is a boon for ExxonMobil’s upstream operations. ExxonMobil has a solid pipeline of profitable projects in the Permian Basin – the most prolific oil and gas resource in the United States – and offshore Guyana.
In Stabroek Block, located off the coast of Guyana, ExxonMobil has made many major discoveries that significantly improve its production outlook. The advantaged growth projects of Guyana have lower greenhouse gas intensity than most of the oil and gas-producing resources across the globe. Thus, in the upstream business front, it could be said that ExxonMobil’s prospects are solid.
XOM has a strong balance sheet, so it can withstand adverse business environments. XOM has a total debt-to-capitalization of 16.7%. Compared to the 24.7% debt-to-capitalization of composite stocks belonging to the industry, ExxonMobil is better off.
What’s Hurting it?
The upstream business of the integrated firm is highly exposed to volatility in oil and gas prices. Also, ExxonMobil is offering a lower dividend yield than the composite stocks belonging to the industry.
Stocks to Consider
Better-ranked players in the energy space include Evolution Petroleum Corporation (EPM - Free Report) , Profire Energy, Inc. (PFIE - Free Report) and Helix Energy Solutions Group, Inc. (HLX - Free Report) . While Evolution Petroleum and Profire Energy carry a Zacks Rank #2 (Buy), Helix Energy sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Through its ownership interests in onshore oil and natural gas properties in the United States, Evolution Petroleum is touted as a key independent energy player.
Profire Energy is mainly focused on the oil and gas industry’s upstream, midstream and downstream transmission segments. PFIE has boosted that its legacy business is doing extremely well, thanks to the resumption of maintenance work of exploration and production players.
Helix Energy is a leading player and is well-poised to grow in the favorable crude pricing environment since it primarily provides specialty services to the offshore energy industry.