Exxon
Mobil is a company that made its IPO in 1882, making it one of the oldest
companies in the sphere. It is a manufacturer and retail provider of
petrochemicals such as olefins, polyethylene, aromatics and plastics that range
for the different product categories. It has a significant shares in companies
in the electrical power generation sectors and a large number of divisions and
subsidiaries with the same brand name. Some of the most famous are Exxon Mobil,
Exxon, Esso and Mobil. These divisions are operate and market products mainly
in the United States, but lately the company has made a large degree of
diversification around the world.
The
main business of the company is energy and it involves the exploration for
crude oil and natural gas as well as the manufacturing of petroleum products
and the transportation and retail of crude oil and natural gas. It was in 2012
when the Apache Corporation acquired Mobil North Sea Limited – a large part of
Exxon, and took over the assets including the Beryl field and other properties.
In 2013 BNK Petroleum sold Tishomingo Field in Oklahoma to Exxon, indirectly
through its subsidiary XTO Energy Inc.
The
initial sale of assets decreased significantly investors’ confidence, as the
company definitely had some rough times in the last year. However, several new
acquisitions have improved the company’s operations and long-term prospects. Syncrude
is a joint venture of Exxon and its purpose is to recover deposits of oil sands
with the use of open pit mining methods. It will extract crude bitumen and will
upgrade it and produce it in a light and sweet crude oil. Imperial Oil is
owning 25% of the interest in the joint venture, while Exxon has the majority
share of 69.6% in Imperial Oil itself. In the course of 2012 the company’s
share of productions of synthetic crude oil was 69 thousand barrels per day.
Another
joint venture for the company is the Kearl project, which was established for
similar purposes, again with the participation of Imperial Oil, which holds a
majority of 70.96%. Exxon has a 100% interest in Exxon Mobil Canada properties,
which on the other hand has another 29.04% share in Imperial Oil. This
complicated corporate structure makes it somewhat hard for financial analysts
to rightfully track the performance of the company. A lot of the earnings are
spread between subsidiaries, which explain the variable stock performance of XOM stock prices.
Over
the last year the company scored good performance, with XOM stock quote
starting at $90 in June 2013 and reaching $102.36 to date. The EPS of the
company is very high, amounting to $7.35 and the dividend payout is 2.69%,
which has kept investors’ expectations. Analysts prognosis state that Exxon Mobil Corp share value will have
a target of $105 with the highest estimates going up to $114 and the lowest to
$85. The average estimate is a 2.53% increase since the last XOM quote. As it can be seen, the
company is perceived as a rather stable one, with slow, but substantial growth
rate ensuring long term increases in share prices.
However,
there is a lot of speculation about the prices of crude oil, as the situation
in the Middle East is defining for the global market. There are a lot of trends
to reallocate resources towards the east, especially in Canada which proved to
be one of the most lucrative countries in the industry. Exxon along with other
companies is trying to gain advantage by setting up operations in Canada, yet
other competitors already have a first move advantage there. With such high
profits for the region, it is doubtful that in the near future some of those
subsidiaries will be purchased by Exxon.
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