The Key Facts of the ExxonMobil Investment Analysis

ExxonMobil is a multinational oil and gas company, headquartered in Irving, Texas (United States). ExxonMobil is one of the largest oil and gas companies by revenue and market capitalization. It is the 11th biggest company by revenue and the 6th biggest oil and gas company by revenue. Currently, ExxonMobil has about 74,900 employees. Here you can get a detailed investment analysis of ExxonMobil. The following shows some key facts of the ExxonMobil investment analysis:

  1. The worldwide demand for oil has grown constantly. However, in 2020, the demand for oil has fallen significantly as a result of COVID-19.
  2. The effects of COVID-19, the low oil prices, the uncertain future of oil and the energy transition have caused a difficult market environment for the oil and gas companies in 2020.
  3. The financial results of the oil companies depend significantly on the price of oil. The price of oil has varied significantly over time.
  4. The business of ExxonMobil is divided into three different business areas: Upstream, Downstream and Chemical. Upstream involves the exploration of oil and gas. Downstream operations involve the conversion of oil and gas into finished products. This includes, for example, refining crude oil into gasoline, natural gas liquids or diesel. With almost 27 million tons, ExxonMobil’s chemical business is among the largest in the world.
  5. ExxonMobil markets fuels and lubricants under four brands: Esso, Exxon, Mobil and ExxonMobil Chemical.
  6. ExxonMobil has the S&P credit rating AA. This credit rating means that ExxonMobil has very strong capacity to meet its financial commitments.
  7. Compared to its competitors, ExxonMobil currently pays the highest dividend yield. The dividend yield is calculated by dividing the dividend per share by the price per share. The dividend yield of ExxonMobil is currently 8.37% (date: 28.12.2020).
  8. ExxonMobil has a dividend payout ratio of over 100%. The dividend payout ratio is very important for investors, because on one side it shows how much of the company’s profit is given back to its shareholders and on the other side it shows if there is still range for future dividend enhancements. A dividend payout ratio of over 100% shows us that the company is currently paying more dividends to its shareholders than it is earning. This shows that the dividend of ExxonMobil could be cut in the future.
  9. There are big differences between ExxonMobil and its European rivals such as Royal Dutch, BP and Total about how they see the future of oil and the energy transition.
  10. ExxonMobil’s economies of scale, its low capital costs and its diversified global portfolio of assets and advanced projects across their Upstream, Downstream and Chemical business lines, help them to create an economic moat over smaller oil and gas companies.

Here you can get a detailed investment analysis of ExxonMobil. Additionally, you can find the investment analysis of other companies listed on the stock market.

Source: Wan Fahmy Redzuan / Shutterstock.com