The purpose of the repurchase of shares by ExxonMobil (NYSE:XOM) has UBS (NYSE:UBS) concerned, as it's not to the end they hoped for after the highly dilutive acquisition of natural gas producer XTO.
"XOM repurchased $3 billion in shares in 3Q, and is increasing the pace to $5 billion in 4Q. However, XOM does not seem to intend to accelerate repurchases to retire the shares issued for the dilutive XTO acquisition; rather, the buyback will remain the “flywheel” to regulate excess cash. We are slightly revising ’10/ ‘11 EPS estimates from $5.77/$5.76 to $5.83/$5.96 primarily on the increased pace of the buyback and higher int’l R&M performance," said UBS.
Exxon closed Friday at $66.49, gaining $0.27, or 0.41 percent. UBS raised their price target on the energy giant from $63 to $65.
Showing posts with label XTO Energy. Show all posts
Showing posts with label XTO Energy. Show all posts
Monday, November 1, 2010
Wednesday, September 15, 2010
RBC on Conoco (NYSE:COP), Marathon (NYSE:MRO) and Chevron (NYSE:CVX)
RBC Capital Markets evaluated a number of large players in the oil and gas industry, including ConocoPhillips (NYSE:COP), Chevron Corp. (NYSE:CVX) and Marathon Oil (NYSE:MRO).
In the view of RBC, the major determinant is how exposed the oil companies are to natural gas. With the weak market, the less exposed, the better.
Their two favorites were Conoco and Chevron, with Conoco rated as a "Outperform," Chevron as a "Top Pick," and Marathon rated as "Sector Perform."
The price target on Conoco is $65 a share; Chevron, $93 a share; and Marathon, $35 a share.
RBC sees Chevron outperforming Exxon (NYSE:XOM) over the next two years on earnings per barrel.
In the view of RBC, the major determinant is how exposed the oil companies are to natural gas. With the weak market, the less exposed, the better.
Their two favorites were Conoco and Chevron, with Conoco rated as a "Outperform," Chevron as a "Top Pick," and Marathon rated as "Sector Perform."
The price target on Conoco is $65 a share; Chevron, $93 a share; and Marathon, $35 a share.
RBC sees Chevron outperforming Exxon (NYSE:XOM) over the next two years on earnings per barrel.
Tuesday, September 14, 2010
Exxon (NYSE:XOM) Downgraded by RBC Capital
RBC Capital Markets downgraded Exxon Mobil Corp. (NYSE:XOM), saying their exposure to the weak natural gas market makes them vulnerable.
This was a reference to the acquisition of XTO Energy in the early part of 2010, which resulted in Exxon becoming the largest natural gas company in the United States.
Natural gas companies have been attempting to diversify by acquiring oil assets because of the expectations the abundant supply of natural gas will keep the price of the energy source down.
RBC said the weak price of natural gas will damage the earnings of Exxon, along with their market valuation. They lowered the price target for the next 12 months from $76 a share to $70 a share, while downgrading them from "Outperform" to "Sector Perform."
This was a reference to the acquisition of XTO Energy in the early part of 2010, which resulted in Exxon becoming the largest natural gas company in the United States.
Natural gas companies have been attempting to diversify by acquiring oil assets because of the expectations the abundant supply of natural gas will keep the price of the energy source down.
RBC said the weak price of natural gas will damage the earnings of Exxon, along with their market valuation. They lowered the price target for the next 12 months from $76 a share to $70 a share, while downgrading them from "Outperform" to "Sector Perform."
Thursday, September 9, 2010
Exxon (NYSE:XOM) Starting to Grab Attention of Bargain Hunters
The recession and BP (NYSE:BP) oil spill put oil companies out of favor, but even with the price of oil rebounding strongly from about $40 a barrel in March 2009, to $74 recently, shares of ExxonMobil (NYSE:XOM) have languished.
Exxon has positioned itself strongly for long-term growth and diversification with its acquisition of giant natural gas producer XTO Energy, but the question is if Exxon and others will be able to move in the short term.
Gas and oil prices appear to be under downward pressure again, as concerns over the recession and a slowing economy have consumers continuing to hold back on spending.
Natural gas is so abundant that it'll probably be years before we see prices move up.
But Exxon could go the lower costs route, creating some margins there based on scale alone.
Stability, growth, a decent dividend, and an assured market make Exxon a bargain at this time. It's a play for those will a longer term outlook on investing though, as short term there is still a lot of volatility in the gas and oil sector.
Exxon has positioned itself strongly for long-term growth and diversification with its acquisition of giant natural gas producer XTO Energy, but the question is if Exxon and others will be able to move in the short term.
Gas and oil prices appear to be under downward pressure again, as concerns over the recession and a slowing economy have consumers continuing to hold back on spending.
Natural gas is so abundant that it'll probably be years before we see prices move up.
But Exxon could go the lower costs route, creating some margins there based on scale alone.
Stability, growth, a decent dividend, and an assured market make Exxon a bargain at this time. It's a play for those will a longer term outlook on investing though, as short term there is still a lot of volatility in the gas and oil sector.
Thursday, July 29, 2010
Exxon Mobil (NYSE:XOM) Earnings Up On Refinery Margins and Oil Prices
In what appears to be a major story in the earnings' report season, Exxon Mobil (NYSE:XOM) was the latest of the oil companies to say refining margins were a major part of their earnings success, along with higher oil prices.
Consequently, earnings in the quarter surged 85 percent for Exxon, coming in at $7.56 billion, or $1.60 a share. That's up from the $3.95 billion, or 81 cents a share, in the same quarter last year.
Revenue soared to $92.5 billion, a 24 percent increase. Analysts had looked for revenue of $98.5 billion and $1.46 a share. The margin spread helped Exxon outperform in earnings even with lower-than-expected revenue.
The oil giant said oil production in the second quarter was 4.0 million barrels of oil equivalent per day, an increase of 8 percent over 2009.
Exxon made a major move to diversify their revenue and earnings by acquiring natural gas giant XTO Energy Inc. for $30 billion. That makes Exxon the largest producer of natural gas in the United States.
In the second half of 2010 they plan on ramping up drilling in the extraordinary shale gas fields in North America.
Consequently, earnings in the quarter surged 85 percent for Exxon, coming in at $7.56 billion, or $1.60 a share. That's up from the $3.95 billion, or 81 cents a share, in the same quarter last year.
Revenue soared to $92.5 billion, a 24 percent increase. Analysts had looked for revenue of $98.5 billion and $1.46 a share. The margin spread helped Exxon outperform in earnings even with lower-than-expected revenue.
The oil giant said oil production in the second quarter was 4.0 million barrels of oil equivalent per day, an increase of 8 percent over 2009.
Exxon made a major move to diversify their revenue and earnings by acquiring natural gas giant XTO Energy Inc. for $30 billion. That makes Exxon the largest producer of natural gas in the United States.
In the second half of 2010 they plan on ramping up drilling in the extraordinary shale gas fields in North America.
Friday, July 9, 2010
Exxon Mobil (NYSE:XOM) Now Largest Gas Producer In U.S.
Exxon Mobil (NYSE:XOM) is now the largest natural gas producer in the United States. This happened on June 25th when the deal closed for the purchase of XTO Energy. Exxon plans to keep XTO's hedges for the 2010 - 2011 year in place., but will not hedge any production in the future.
They have also assumed $11 billion of debt and a share increase on outstanding shares of approximately 9 percent. Before the acquisition, Exxon had $2 billion worth of shares in the company. Their plan is to repurchase $3 billion in shares in the third quarter.
Exxon's also intends to restructure the debt once its economical. They are saying this does not change their focus on returns, but they admit it could be a few years away before returns on their investments may be seen. Due to the long term nature of the acquisition.
Short term they plan on drilling only the most attractive wells while holding on to their current uneconomical resources at the lowest possible cost. With little threat of their lease expiring and their financial strength, they can take there time and drill opportunistically unlike smaller exploration companies.
They have also assumed $11 billion of debt and a share increase on outstanding shares of approximately 9 percent. Before the acquisition, Exxon had $2 billion worth of shares in the company. Their plan is to repurchase $3 billion in shares in the third quarter.
Exxon's also intends to restructure the debt once its economical. They are saying this does not change their focus on returns, but they admit it could be a few years away before returns on their investments may be seen. Due to the long term nature of the acquisition.
Short term they plan on drilling only the most attractive wells while holding on to their current uneconomical resources at the lowest possible cost. With little threat of their lease expiring and their financial strength, they can take there time and drill opportunistically unlike smaller exploration companies.
Monday, June 28, 2010
Goldman Sachs (NYSE:GS) Lowers EPS for EXxonMobil (NYSE:XOM)
Citing their recent acquisition of XTO Energy (NYSE:XTO), Goldman Sachs (NYSE:GS) has lowered their earnings per share estimates for EXxonMobil (NYSE:XOM) through 2012.
The reasoning is the extensive dilution of earnings the company should experience as a result of buying XTO.
Goldman maintains a "Neutral" rating on ExxonMobil, along with a $65 price target.
The reasoning is the extensive dilution of earnings the company should experience as a result of buying XTO.
Goldman maintains a "Neutral" rating on ExxonMobil, along with a $65 price target.
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