Exxon's Earnings Amidst Oil Price Challenges Has Bright Spots, Says Analyst
Portfolio Pulse from Lekha Gupta
Goldman Sachs analyst Neil Mehta has a positive outlook on Exxon Mobil Corp.'s (XOM) Q1 FY24 performance despite challenges from weak oil and gas prices. The company expects gas price fluctuations to impact its upstream results negatively by $0.2 to $0.6 billion. However, the analyst's estimates for Upstream, Downstream, and Chemicals earnings are above expectations, with implied EPS at $2.15, surpassing both Goldman Sachs' estimate of $1.95 and the FactSet consensus of $2.06. Revenue projections for 2024-2026 show growth. Investors can also gain exposure through Energy Select Sector SPDR Fund (XLE) and iShares U.S. Energy ETF (IYE). XOM shares saw a slight increase of 0.29% to $119.65.
April 04, 2024 | 5:59 pm
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POSITIVE IMPACT
iShares U.S. Energy ETF (IYE) is another way for investors to gain exposure to Exxon Mobil's promising performance, potentially benefiting from the positive analyst outlook.
As IYE offers exposure to Exxon Mobil, the optimistic analyst projections for Exxon's upcoming performance could attract more investors to IYE, possibly leading to a short-term price increase.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
Investors can gain exposure to Exxon Mobil's positive outlook through the Energy Select Sector SPDR Fund (XLE), which may see a positive impact.
Given that XLE provides exposure to Exxon Mobil, the positive analyst outlook for Exxon's Q1 FY24 performance could lead to increased investor interest in XLE, potentially driving its price up in the short term.
CONFIDENCE 80
IMPORTANCE 75
RELEVANCE 70
POSITIVE IMPACT
Goldman Sachs analyst Neil Mehta predicts Exxon Mobil's Q1 FY24 performance to surpass expectations despite oil price volatility, with an implied EPS of $2.15.
Despite the anticipated negative impact from gas price fluctuations, the analyst's higher-than-expected earnings estimates for Upstream, Downstream, and Chemicals segments, along with a higher implied EPS, suggest a positive short-term outlook for XOM's stock.
CONFIDENCE 85
IMPORTANCE 90
RELEVANCE 100