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ExxonMobil CEO Vows Legal Action Against Proxy Rule Abusers
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Exxon Mobil Corporation’s (XOM - Free Report) CEO Darren Woods issued a clear message to activist shareholders on Tuesday to adhere to the established rules when filing proposals. Speaking via video link to the Council of Institutional Investors in New York, Woods warned that ExxonMobil is prepared to take legal action if shareholders attempt to "abuse" the proxy proposal process.
XOM's Stance on the Proxy Proposal System
Earlier this year, ExxonMobil sued two activist groups— Follow This and Arjuna Capital — after they filed a climate-related shareholder proposal. Although the lawsuit was ultimately dismissed in June after the resolution was withdrawn, Woods emphasized that ExxonMobil is ready to pursue similar actions in the future if necessary.
The legal action drew criticism from some institutional investors, including the California Public Employees’ Retirement System (CalPERS), the largest public pension in the U.S. CalPERS argued that XOM’s legal moves threatened to undermine shareholder rights and stifle debate.
Woods’ remarks highlight the company's commitment to ensuring that the proxy proposal system, intended for shareholder input, is used appropriately. While ExxonMobil is open to shareholder suggestions, Woods insisted that proposals must follow established protocols and regulatory guidance.
ExxonMobil Defends Its Position Against Activist Proposals
Woods defended ExxonMobil’s legal actions, describing the activist proposals as “Trojan horses” designed to undermine the company’s business. He asserted that the misuse of the shareholder resolution process ultimately harmed other investors, and ExxonMobil’s stance was a necessary measure to protect the interests of its broader shareholder base.
“We think the process was being abused to the detriment of the rest of the shareholders,” Woods said.
XOM’s Arbitration With Chevron and Hess Over Guyana Stake
Aside from its battle with activist investors, ExxonMobil is currently involved in a separate months-long arbitration with Chevron and Hess. The dispute centers around Hess’ 30% stake in ExxonMobil’s oil project in Guyana, which is considered the largest oil discovery in the past decade. Chevron’s acquisition of Hess in 2023 added a new layer of complexity to the dispute.
Despite claims that ExxonMobil has been “unusually aggressive” in its approach to both the arbitration and the shareholder activism cases, Woods dismissed such assertions, noting that ExxonMobil is simply following the rules and processes that have been established.
XOM’s Zacks Rank & Key Picks
ExxonMobil currently carries a Zack Rank #3 (Hold).
MPLX derives stable fee-based revenues from long-term contracts, with minimal exposure to commodity-price fluctuations. The partnership’s robust capital expenditure forecast for 2024, along with significant expansion initiatives, underscores its commitment to sustainable growth.
The Zacks Consensus Estimate for MPLX’s 2024 EPS is pegged at $4.29. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB’s expanding international upstream projects indicate a positive trajectory for revenues and profitability, especially as oil demand continues to rise globally.
The Zacks Consensus Estimate for CLB’s 2024 EPS is pegged at $0.95. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
VAALCO Energy is an independent energy company involved in upstream business operations, with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company’s production outlook seems bright.
The Zacks Consensus Estimate for EGY’s 2024 EPS is pegged at $0.65. The company has a Value Score of A. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.
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ExxonMobil CEO Vows Legal Action Against Proxy Rule Abusers
Exxon Mobil Corporation’s (XOM - Free Report) CEO Darren Woods issued a clear message to activist shareholders on Tuesday to adhere to the established rules when filing proposals. Speaking via video link to the Council of Institutional Investors in New York, Woods warned that ExxonMobil is prepared to take legal action if shareholders attempt to "abuse" the proxy proposal process.
XOM's Stance on the Proxy Proposal System
Earlier this year, ExxonMobil sued two activist groups— Follow This and Arjuna Capital — after they filed a climate-related shareholder proposal. Although the lawsuit was ultimately dismissed in June after the resolution was withdrawn, Woods emphasized that ExxonMobil is ready to pursue similar actions in the future if necessary.
The legal action drew criticism from some institutional investors, including the California Public Employees’ Retirement System (CalPERS), the largest public pension in the U.S. CalPERS argued that XOM’s legal moves threatened to undermine shareholder rights and stifle debate.
Woods’ remarks highlight the company's commitment to ensuring that the proxy proposal system, intended for shareholder input, is used appropriately. While ExxonMobil is open to shareholder suggestions, Woods insisted that proposals must follow established protocols and regulatory guidance.
ExxonMobil Defends Its Position Against Activist Proposals
Woods defended ExxonMobil’s legal actions, describing the activist proposals as “Trojan horses” designed to undermine the company’s business. He asserted that the misuse of the shareholder resolution process ultimately harmed other investors, and ExxonMobil’s stance was a necessary measure to protect the interests of its broader shareholder base.
“We think the process was being abused to the detriment of the rest of the shareholders,” Woods said.
XOM’s Arbitration With Chevron and Hess Over Guyana Stake
Aside from its battle with activist investors, ExxonMobil is currently involved in a separate months-long arbitration with Chevron and Hess. The dispute centers around Hess’ 30% stake in ExxonMobil’s oil project in Guyana, which is considered the largest oil discovery in the past decade. Chevron’s acquisition of Hess in 2023 added a new layer of complexity to the dispute.
Despite claims that ExxonMobil has been “unusually aggressive” in its approach to both the arbitration and the shareholder activism cases, Woods dismissed such assertions, noting that ExxonMobil is simply following the rules and processes that have been established.
XOM’s Zacks Rank & Key Picks
ExxonMobil currently carries a Zack Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked stocks like MPLX LP (MPLX - Free Report) , Core Laboratories Inc. (CLB - Free Report) and VAALCO Energy, Inc. (EGY - Free Report) . While MPLX currently sports a Zacks Rank #1 (Strong Buy), Core Laboratories and VAALCO Energy carry a Zacks Rank #2 (Buy) each. You can see the complete list of today’s Zacks #1 Rank stocks here.
MPLX derives stable fee-based revenues from long-term contracts, with minimal exposure to commodity-price fluctuations. The partnership’s robust capital expenditure forecast for 2024, along with significant expansion initiatives, underscores its commitment to sustainable growth.
The Zacks Consensus Estimate for MPLX’s 2024 EPS is pegged at $4.29. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
Core Laboratories, an oilfield services company, has a deep portfolio of sophisticated, proprietary products and services that positions it to take advantage of the growing maturity in the global hydrocarbon reserve base. CLB’s expanding international upstream projects indicate a positive trajectory for revenues and profitability, especially as oil demand continues to rise globally.
The Zacks Consensus Estimate for CLB’s 2024 EPS is pegged at $0.95. The company has a Value Score of B. It has witnessed upward earnings estimate revisions for 2024 and 2025 in the past 30 days.
VAALCO Energy is an independent energy company involved in upstream business operations, with a diversified presence in Africa and Canada. Having a large inventory of drilling locations in premium Canadian Acreage, the company’s production outlook seems bright.
The Zacks Consensus Estimate for EGY’s 2024 EPS is pegged at $0.65. The company has a Value Score of A. It has witnessed upward earnings estimate revisions for 2024 in the past 30 days.