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Exxon Mobil (XOM) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

Exxon Mobil (XOM) closed at $70.87 in the latest trading session, marking a +0.77% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.35%. At the same time, the Dow added 0.24%, and the tech-heavy Nasdaq gained 0.56%.

Prior to today's trading, shares of the oil and natural gas company had gained 2.81% over the past month. This has lagged the Oils-Energy sector's gain of 9.6% and the S&P 500's gain of 4.69% in that time.

Investors will be hoping for strength from XOM as it approaches its next earnings release, which is expected to be January 31, 2020. The company is expected to report EPS of $0.71, down 52.98% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $67.17 billion, down 6.58% from the prior-year quarter.

Any recent changes to analyst estimates for XOM should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 2.97% lower. XOM is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, XOM is holding a Forward P/E ratio of 21.6. This valuation marks a premium compared to its industry's average Forward P/E of 14.42.

Also, we should mention that XOM has a PEG ratio of 2.2. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Oil and Gas - Integrated - International stocks are, on average, holding a PEG ratio of 2.02 based on yesterday's closing prices.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 190, putting it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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