Exxon Mobil Corp
Energy
North America
Investment summary

Exxon Mobil is one of the largest publicly traded oil and gas companies globally, and one of the largest refiners and marketers of petroleum products with upstream production of 3.7MOEBD (2021) and downstream and chemical production of 234MTA. The company's reserves included 9bn bbl of oil liquids and 38trln cf of natural gas as of the end 2020.

Details
Ticker
XOM.N
Trading currency
USD
Last close price, (currency)
110.04
Common shares outstanding
4,082,000,000
Preferred shares
0
MktCap, (currency) mn
440,511
Target price
Current opinion
Description

Exxon Mobil Corporation is engaged in energy business. The Company’s principal business involves exploration for, and production of, crude oil and natural gas, and the manufacture, trade, transport and sale of crude oil, natural gas, petroleum products, petrochemicals and a range of specialty products. The Company's segments include Upstream, Downstream and Chemical. The Upstream segment is organized and operates to explore for and produce crude oil and natural gas. The Downstream segment manufactures, trades and sells petroleum products. The refining and supply operations encompass a global network of manufacturing plants, transportation systems, and distribution centers that provide a rang... Exxon Mobil Corporation is engaged in energy business. The Company’s principal business involves exploration for, and production of, crude oil and natural gas, and the manufacture, trade, transport and sale of crude oil, natural gas, petroleum products, petrochemicals and a range of specialty products. The Company's segments include Upstream, Downstream and Chemical. The Upstream segment is organized and operates to explore for and produce crude oil and natural gas. The Downstream segment manufactures, trades and sells petroleum products. The refining and supply operations encompass a global network of manufacturing plants, transportation systems, and distribution centers that provide a range of fuels, lubricants and other products and feedstocks to its customers around the world. The Chemical segment is organized and operates to manufacture and sell petrochemicals. The Chemical business supplies olefins, polyolefins, aromatics, and a variety of other petrochemicals.

Industry view (TAM)

According to EIA, the global oil production is estimated at 95.55mn bbl/day in 2021 compared to 93.87mn bbl/day in 2020. The largest oil producing regions are OPEC countries (33% in 2021), USA (20%), Russia (11%), Canada (6%), China and Brazil. The oil price reached $71/bbl in 2021 compared to $42/bbl in 2020. The oil demand was driven by the post-COVID recovery of industrial production and air transportation globally. The political turbulence created a risk of undersupply in 2022, driving the oil price above $100/bbl. Medium-term trends will be affected by the transition to low-carbon energy. Companies of the energy sector are targeting potentially large markets of Carbon Capture and Storage ($4 trln by 2050), Hydrogen ($1.5 trln) and Biofuelds ($1 trln). The traditional Oil and Gas market is estimated at $6.5trln in 2050 and the Chemicals market is estimated at $5trln in 2050.

Pros
  1. Exxon Mobil has a large portfolio of assets gradually upgraded through investments and mix improvements
  2. Highest earnings among international oil companies in 2021
  3. A potential to double earnings and cash flow by 2027 versus 2019, lowering breakeven from $41/boe in 2021 to $30/bbl in 2027
  4. Large and efficient refining capacity with opportunities to repurse assets for production of low-cost biofuelds
  5. Global leader in carbon capture, representing one-fifth of global capacity (9MTA),
  6. Sustainable dividend history with 39 consecutive years of annual dividend growth, including $15bn dividend payout in 2021
Cons
  1. Limited growth opportunities due to already high scale of operations
  2. Exposure to falling oil demand in longer-term due to transition to low-carbon energy
  3. High capex requirements for alternative energy opportunities, including CCS, Hydrogen and Biofuels
  4. Exposure to political risks and volitile oil price
  5. Relatively high breakeven compared to junior peers, limited upside for margin improvement
Risks
  1. Oil price volatility
  2. Weak demand for oil and gas products, chemicals due to global growth deceleration
  3. Cost inflation
  4. Geopolitical risks
  5. Risks of transition to low-carbon energy, including technology and demand risks
Historical price chart
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Peer Group (top 5)

Company RIC Market Capitalization, $mn Last reporting year P/E Fwd 1Y P/E Fwd 2Y EV/EBITDA 1Y fwd EV/EBITDA 2Y fwd EV/Revenues 1y fwd EV/Revenues 2y fwd
Exxon Mobil Corp XOM.N 444,267 2022-12-31 10.4 10.7 5.5 5.8 1.2 1.2
Chevron Corp CVX.N 306,040 2022-12-31 10.2 10.1 5.1 5.3 1.5 1.4
BP PLC BP.L 117,445 2022-12-31 5.8 6.0 3.3 3.5 0.6 0.7
TotalEnergies SE TTEF.PA 152,918 2022-12-31 5.4 5.8 3.1 3.5 0.7 0.7
Shell PLC SHEL.L 209,988 2022-12-31 6.3 6.5 3.5 3.8 0.7 0.8
Saudi Basic Industries Corporation SJSC 2010.SE 72,243 2022-12-31 18.8 15.8 8.4 7.6 1.6 1.6
Financials
2017 2018 2019 2020 2021 2022 2023 2024 2025
Revenue 237,162 279,332 255,583 178,574 276,692 413,680 397,994 378,345 339,030
Growth 18% -9% -30% 55% 50% -4% -5% -10%
EBITDA 31,967 40,013 27,007 15,356 43,563 87,586 86,342 81,233 72,762
EBITDA margin 13.5% 14.3% 10.6% 8.6% 15.7% 21.2% 21.7% 21.5% 21.5%
Net income 19,710 20,840 14,340 -22,440 23,040 55,740 43,677 39,599 34,486
Net margin 8.3% 7.5% 5.6% -12.6% 8.3% 13.5% 11.0% 10.5% 10.2%
Net debt 39,159 34,754 43,985 63,415 41,037 41,037 41,037 41,037 41,037
MktCap 295,658 174,525 259,017 461,947 461,947 461,947 461,947

Historical Multiples

2019 2020 2021 2022 2023 2024 2025
EV/Revenue 1.3 1.3 1.1 1.2 1.3 1.3 1.5
EV/EBITDA 12.6 15.5 6.9 5.7 5.8 6.2 6.9
P/E 20.6 -7.8 11.2 8.3 10.6 11.7 13.4
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