Exxon Mobil: A Top Pick for Billionaire Ken Fisher Amid Strong Financials
Monday, Nov 11, 2024 3:59 pm ET
4min read Billionaire investor Ken Fisher has always been known for his contrarian market calls and unique interpretation of market information. In the fourth quarter of 2023, Fisher increased his stake in Exxon Mobil (XOM) by a staggering 566.18%, making it one of his most significant position increases. This move reflects Fisher's confidence in XOM's strong financials and growth potential, even in the face of short-term market volatility.
Exxon Mobil's robust cash flow and dividend history are key factors driving its appeal for Ken Fisher. In Q4 2023, XOM generated $13.7 billion in cash flow from operations, demonstrating its financial strength. Additionally, XOM has consistently increased its dividend for 41 consecutive years, with a 4% increase in Q3 2023. This stable and growing dividend, combined with strong cash flow, makes XOM an attractive investment for Fisher, who values companies with solid fundamentals and financial stability.
Exxon Mobil's strategic acquisitions and divestments have played a significant role in Fisher's investment decision. In 2023, XOM strengthened its portfolio with $4.1 billion of non-core asset divestments and two acquisitions, one accelerating Low Carbon Solutions and another transforming the Upstream business. These transactions, combined with XOM's industry-leading earnings and cash flow, have contributed to Fisher's bullish stance on the company.
Exxon Mobil's low debt-to-capital ratio of 17% and net-debt-to-capital ratio of 4% (Q4 2023) reflect a strong balance sheet, which likely contributes to Ken Fisher's confidence in the company. This financial stability, coupled with consistent earnings growth (2023 earnings: $36.0 billion) and cash flow generation ($55.4 billion in 2023), indicates that XOM can withstand market volatility and maintain its dividend payouts.
Exxon Mobil's return on capital employed (ROCE) in 2023 was 15%, significantly higher than the industry average of 10-12% for integrated oil and gas companies. This strong ROCE indicates that Exxon Mobil is effectively utilizing its capital to generate profits, making it an attractive investment opportunity according to billionaire Ken Fisher.
Exxon Mobil's dividend yield and payout ratio are competitive within the energy sector. As of 2024, XOM's dividend yield is approximately 4.5%, while its payout ratio is around 50%. This places it favorably among its peers, such as Chevron (CVX) with a yield of 3.8% and payout ratio of 45%, and BP (BP) with a yield of 4.2% and payout ratio of 60%. XOM's strong financials and consistent dividend growth make it an attractive option for income-oriented investors.
In conclusion, Exxon Mobil's strong financials, strategic acquisitions, and low-risk profile have made it a top pick for billionaire Ken Fisher. Despite short-term market volatility, Fisher's significant stake in XOM reflects his confidence in the company's long-term growth potential and solid fundamentals. As an experienced investor with a proven track record, Fisher's endorsement of Exxon Mobil serves as a strong signal for potential investors looking for a stable and profitable energy play.
Exxon Mobil's robust cash flow and dividend history are key factors driving its appeal for Ken Fisher. In Q4 2023, XOM generated $13.7 billion in cash flow from operations, demonstrating its financial strength. Additionally, XOM has consistently increased its dividend for 41 consecutive years, with a 4% increase in Q3 2023. This stable and growing dividend, combined with strong cash flow, makes XOM an attractive investment for Fisher, who values companies with solid fundamentals and financial stability.
Exxon Mobil's strategic acquisitions and divestments have played a significant role in Fisher's investment decision. In 2023, XOM strengthened its portfolio with $4.1 billion of non-core asset divestments and two acquisitions, one accelerating Low Carbon Solutions and another transforming the Upstream business. These transactions, combined with XOM's industry-leading earnings and cash flow, have contributed to Fisher's bullish stance on the company.
Exxon Mobil's low debt-to-capital ratio of 17% and net-debt-to-capital ratio of 4% (Q4 2023) reflect a strong balance sheet, which likely contributes to Ken Fisher's confidence in the company. This financial stability, coupled with consistent earnings growth (2023 earnings: $36.0 billion) and cash flow generation ($55.4 billion in 2023), indicates that XOM can withstand market volatility and maintain its dividend payouts.
Exxon Mobil's return on capital employed (ROCE) in 2023 was 15%, significantly higher than the industry average of 10-12% for integrated oil and gas companies. This strong ROCE indicates that Exxon Mobil is effectively utilizing its capital to generate profits, making it an attractive investment opportunity according to billionaire Ken Fisher.
Exxon Mobil's dividend yield and payout ratio are competitive within the energy sector. As of 2024, XOM's dividend yield is approximately 4.5%, while its payout ratio is around 50%. This places it favorably among its peers, such as Chevron (CVX) with a yield of 3.8% and payout ratio of 45%, and BP (BP) with a yield of 4.2% and payout ratio of 60%. XOM's strong financials and consistent dividend growth make it an attractive option for income-oriented investors.
In conclusion, Exxon Mobil's strong financials, strategic acquisitions, and low-risk profile have made it a top pick for billionaire Ken Fisher. Despite short-term market volatility, Fisher's significant stake in XOM reflects his confidence in the company's long-term growth potential and solid fundamentals. As an experienced investor with a proven track record, Fisher's endorsement of Exxon Mobil serves as a strong signal for potential investors looking for a stable and profitable energy play.
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