Pros Top Trump Stock for 2025 |
ExxonMobil (XOM) captured financial pros’ attention following Donald Trump’s victory in the 2024 election, with search volume surging among institutional investors. The connection isn’t hard to understand. Trump’s energy policies during his first term strongly favored domestic oil and gas production. With ExxonMobil’s recent acquisition of Pioneer Natural Resources doubling down on U.S. shale, particularly in the prolific Permian Basin, the company is perfectly positioned to benefit from potential regulatory rollbacks and expanded drilling permits under a second Trump administration. But looking beyond the politics, ExxonMobil’s fundamentals tell an even more compelling story. Exxon Mobil’s Business In a single stroke this May, ExxonMobil transformed America’s energy landscape. Its $60 billion Pioneer acquisition didn’t just cement its dominance in the Permian Basin – it created an unmatched powerhouse that pumps more oil than most OPEC nations. From West Texas well heads to global retail pumps, ExxonMobil’s integrated empire now spans every link in the energy chain, setting it apart from any competitor in the Western hemisphere. Operating across 70 countries, ExxonMobil leverages its massive scale and technical expertise to deliver industry-leading returns. The company’s integrated model provides natural hedges across the energy value chain, helping maintain profitability through commodity price cycles.
ExxonMobil segments its business into the following areas:
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The company’s third quarter showcased the strength of its integrated model, with earnings of $8.6 billion despite volatile commodity prices. Production hit 4.6 million barrels of oil equivalent per day – the highest level since 2011 – driven by record Permian Basin output exceeding 1.4 million barrels per day. Management continues to optimize the portfolio through strategic acquisitions and non-core asset sales. Beyond Pioneer, the company is advancing multiple growth projects including expansion in Guyana, where production recently hit 600,000 barrels per day. ExxonMobil is also positioning for the energy transition through investments in carbon capture, hydrogen, and biofuels. The company recently secured the largest offshore carbon storage site in the U.S. and signed its fifth carbon capture customer agreement. Financials
Source: Stock Analysis ExxonMobil’s financial performance demonstrates the power of its integrated model and operational excellence. The company generated revenue of $350.5 billion over the trailing twelve months, producing industry-leading operating cash flow of $56.5 billion. This cash generation showcases the company’s ability to maintain profitability even in volatile commodity markets. Profitability remains robust, with gross margins of 31.5% leading integrated oil peers outside of pure-play producers. Net income reached $33.7 billion over the trailing twelve months despite significant commodity price fluctuations. The company’s free cash flow generation of $32.8 billion provides more than ample coverage of its $3.80 annual dividend while funding strategic growth investments. The balance sheet stands out as one of the strongest in the industry, with a conservative 13.3% debt-to-capital ratio providing significant financial flexibility. Management’s focus on cost discipline has delivered impressive results, with $11.3 billion in structural cost savings achieved since 2019. The company remains on track to reach its target of $15 billion in total savings by 2027, permanently improving its cost structure and long-term profitability potential. Valuation
Source: Seeking Alpha Current valuation metrics suggest ExxonMobil trades at reasonable levels relative to its peer group. The company’s forward P/E ratio of 14.9x sits slightly below the peer average of 15.2x, while its enterprise value to EBITDA multiple of 7.4x carries a modest premium to the peer average of 5.9x. The price-to-cash flow ratio of 9.4x similarly reflects a premium to peers averaging 5.6x. While these metrics suggest ExxonMobil trades at a premium, this valuation is justified by the company’s superior asset base, integrated business model, consistent operational execution, and financial discipline. Growth
Source: Seeking Alpha ExxonMobil’s growth trajectory stands out among integrated oil majors. Revenue has grown at a compound annual rate of 12.4% over the past three years, outpacing most peers and demonstrating the company’s ability to capitalize on favorable market conditions. Even more impressive is the three-year EBITDA compound annual growth rate of 27.3%, which leads the integrated oil peer group. This growth hasn’t come at the expense of balance sheet strength, as evidenced by the 11.1% three-year growth in total assets reflecting disciplined capital allocation. The company’s tangible book value has increased at an 18.7% compound annual rate over the same period, highlighting management’s ability to create lasting shareholder value through the cycle. Profitability
Source: Seeking Alpha ExxonMobil’s profitability metrics reflect its competitive advantages and operational excellence. The company maintains a gross margin of 31.5%, somewhat below the peer average of 46.3% which includes several pure-play producers with different business models. More telling is the EBITDA margin of 20.8%, which demonstrates strong cash generation capabilities despite the integrated business model’s inherently lower margins in downstream operations. Return metrics tell an impressive story, with return on equity of 14.5% placing near the top of the peer group. The company’s return on total capital of 10.4% leads most competitors, reflecting efficient capital allocation across the business portfolio. Cash flow conversion stands out as best-in-class, supporting both reinvestment in the business and substantial shareholder returns.
Our Opinion 10/10 Exxon Mobil was a great company before the election. Now, it’s a great company with amazing prospects. The company’s industry-leading scale and integration benefits provide competitive advantages that are difficult to replicate. Its best-in-class Permian Basin position, particularly following the Pioneer acquisition, ensures access to low-cost resources for years to come. The strong balance sheet and consistent cash flow generation provide both defensive characteristics and flexibility to pursue growth opportunities. Current valuation multiples appear reasonable, given the quality of the asset base and growth potential. The clear path to continued growth, encompassing both traditional energy and new low-carbon businesses, positions ExxonMobil well for various energy transition scenarios. |
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Proprietary Data Insights Financial Pros’ Top Meme Value Stock Searches in the Last Month
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