Exxon Mobil Attracts Investor Attention: Earnings Estimates and Zacks Rank Analysis

Exxon Mobil (XOM) has returned -1% over the past month, while the Zacks S&P 500 composite has increased +4.5%. Analysts expect Q1 earnings of $1.46 per share, a -31.8% year-over-year change. For the current fiscal year, the consensus earnings estimate is $6.41, a -17.7% change from the prior year. Exxon has a Zacks Rank #3 (Hold) based on earnings estimate revisions.

Exxon Mobil Corporation (XOM), a global energy giant, is set to release its fiscal second-quarter earnings on Friday, August 1. The company, headquartered in Spring, Texas, has been facing challenges due to lower oil and natural gas prices, which have impacted its exploration and production activities. Despite recent stock price gains, analysts remain cautious about the company's earnings performance.

According to analysts, XOM is expected to report a profit of $1.44 per share on a diluted basis, a decrease of 32.7% from the $2.14 per share reported in the year-ago quarter [1]. This drop is attributed to a significant decline in both crude oil and natural gas prices during the quarter. Exxon Mobil expects a $1.2 billion hit specifically from lower liquids prices and an additional $0.7 billion impact due to weaker natural gas prices [2].

Seasonal demand shifts, planned maintenance activities, and evolving industry margins are also expected to exert downward pressure on the company’s financial results. Despite these challenges, the company's stock has seen a recent rally, climbing approximately 9% over the past month, fueled by recovering oil prices and renewed investor optimism [2].

Analysts’ consensus opinion on XOM stock is reasonably bullish, with a “Moderate Buy” rating overall. Out of 24 analysts covering the stock, 15 advise a “Strong Buy” rating, one suggests a “Moderate Buy,” seven give a “Hold,” and one recommends a “Strong Sell.” The average analyst price target is $122.78, indicating a potential upside of 7.8% from the current levels [1].

For the full year, analysts expect XOM to report EPS of $6.38, a decrease of 18.1% from $7.79 in fiscal 2024. However, its EPS is expected to rise 12.9% year-over-year to $7.20 in fiscal 2026 [1]. The Zacks Rank #3 (Hold) for Exxon is based on earnings estimate revisions, indicating a cautious stance on the stock's near-term performance [3].

XOM's stock has underperformed the S&P 500 Index’s 11.6% gains over the past 52 weeks, with shares up marginally during this period. However, it outperformed the Energy Select Sector SPDR Fund’s 2.6% decline over the same time frame [1].

References:
[1] https://www.barchart.com/story/news/33409283/exxon-mobil-earnings-preview-what-to-expect
[2] https://www.benzinga.com/trading-ideas/movers/25/07/46325425/exxon-mobil-sees-shares-rally-but-prepares-investors-for-1-5-billion-profit-hit
[3] https://finviz.com/news/105258/exxon-mobil-corporation-xom-is-attracting-investor-attention-here-is-what-you-should-know