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Macquarie analyst downgrades Exxon Mobil

NEW YORK (AP) -- Macquarie Equities Research downgraded Exxon Mobil because it doesn't believe shares have much more room to move to the upside. Shares are nearing an all-time high after rising 6 percent over the past month.

THE OPINION: "We believe that Exxon will struggle to generate production growth in the near term, and now forecast essentially flat production in both 2013 and 2014, with about 1.5 percent growth in 2015 when liquefied natural gas projects in Papua New Guinea and Australia begin to ramp up," wrote analyst Jason Gammel.

Gammel downgraded Exxon shares to "Neutral" from "Outperform" and lowered his price target by $2 to $99, saying that Exxon's production and stock buybacks will both be lower than he previously expected.

Exxon Mobil Corp. has been buying back shares at a pace of about $5 billion per quarter, but Gammel believes that pace will slow to $15 billion in stock for 2013 and possibly $10 billion in stock next year.

"Combined with the 2.5 percent dividend yield, this is still a robust 6 percent total cash return to shareholders. However, it would represent a retrenchment and the market seldom rewards a reduction in cash returns," Gammel wrote.

THE SHARES: Down $1.10 to $90.66 in afternoon trading. Over the past 52 weeks, the company's shares have traded between $77.13 and $93.67.