Exxon Mobil (XOM:NYE) is actively exploring opportunities in the electric vehicle (EV) market by considering lithium supply agreements with major players like Tesla (TSLA:NSD), Ford (F:NYE), and Volkswagen (VWAGY:OTC). As global economies shift towards cleaner energy, Exxon aims to leverage its expertise in oil extraction to become a crucial lithium supplier. The recent announcement has boosted XOM stock by 3% on July 31. Analyst present a bearish outlook on the XOM stock forecast.
Exxon’s Lithium Ambitions Take Shape:
Exxon’s foray into the EV market gained momentum last month when it revealed plans for a substantial lithium processing facility in Arkansas. This facility is expected to have an annual capacity of 75,000 to 100,000 MT of lithium and will incorporate Exxon’s expertise in drilling operations. The company is yet to decide whether it will operate alone or collaborate with a partner for lithium production.
Embracing Clean Alternatives Amid Oil Pressures:
The move towards lithium supply underscores Exxon’s recognition of the growing demand for greener energy solutions. As economies worldwide emphasize cleaner alternatives, Exxon’s traditional oil business faces increased pressure. By venturing into lithium production, Exxon seeks to secure a foothold in the rapidly expanding multi-billion-dollar EV industry.
During Exxon’s Q2FY23 earnings report, the company missed expectations. In a subsequent conference call, CEO Darren Woods emphasized the compatibility of lithium extraction with their existing refinery, chemical, and upstream operations.
XOM Stock Forecast-Analysts’ Outlook:
Wells Fargo analyst Roger Reed recently adjusted the XOM stock price target to $129, indicating a potential upside of 20.3%, while maintaining a Buy rating.
On Stock Target Advisor, Exxon stock holds a Buy consensus analyst rating based on nine Buy and seven Hold ratings. The average price target of $124.93 suggests a 16.5% upside potential from the current levels. So far this year, XOM stock has gained 17.4%.
Conclusion:
As Exxon Mobil ventures into the EV market with its lithium aspirations, investors closely monitor its strategic moves and potential impact on the XOM stock forecast.
