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Record First Quarter Earnings
Exxon Mobil Corporation announced record first-quarter earnings of $11.4 billion, or $2.79 per share, in 2023. The results were negatively impacted by $200 million in unfavorable identified items associated with additional European taxes on the energy sector. Capital and exploration expenditures reached $6.4 billion, keeping the company on track to meet its full-year guidance of $23 billion to $25 billion.
Production and Expansion Highlights
The company increased oil and gas net production by almost 300,000 oil-equivalent barrels per day compared to the first quarter of 2022. ExxonMobil started up the Beaumont Refinery expansion, reaching a capacity of 250,000 barrels per day to help meet global demand. The company also announced a final investment decision for the Uaru offshore development and two new discoveries in Guyana.
Low Carbon Solutions Business Growth
ExxonMobil’s Low Carbon Solutions business grew with a new long-term customer contract for carbon capture, transportation, and storage. The company had reduced greenhouse gas emissions intensity by more than 10% and methane intensity by over 50% relative to a 2016 baseline as of year-end 2022.
Financial Highlights and Shareholder Distributions
First-quarter earnings were $11.4 billion compared to $12.8 billion in the fourth quarter of 2022. Excluding identified items, earnings were $11.6 billion, down from $14.0 billion in the prior quarter. Cash flow from operations totaled $16.3 billion, and free cash flow was $11.4 billion for the quarter. Shareholder distributions of $8.1 billion included $4.3 billion of share repurchases, keeping the company on track to repurchase up to $17.5 billion during the year. The Corporation declared a second-quarter dividend of $0.91 per share.
Exxon Mobil Stock Analysis
The average analyst target price for Exxon Mobil stock is $124.54 over the next 12 months, with a Strong Buy rating. Stock Target Advisor’s own stock analysis of Exxon Mobil is Slightly Bearish, based on 5 positive signals and 8 negative signals. Exxon Mobil’s stock price has changed by +1.19% over the past week, +11.03% over the past month, and +33.98% over the last year.
Strengths and Weaknesses
Exxon Mobil has a high market capitalization, high dividend returns, low debt, positive cash flow, and positive free cash flow. However, the stock has high volatility, is overpriced compared to earnings, book value, cash flow, and free cash flow basis, and shows poor capital utilization, low earnings growth, and low revenue growth compared to its sector.
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