Group 1 - ExxonMobil has updated its four-year financing plan, proposing to issue $3.4 billion in stock [1] - The company anticipates total expenditures of $41.3 billion over the next four years [1]

Market Overview - The major U.S. indices showed slight declines, with the Dow Jones Industrial Average closing at 50,121.40, down 0.13%, the S&P 500 at 6,941.47, down 0.34 points, and the Nasdaq Composite at 23,066.47, down 0.16% [2] - This dip followed a strong January jobs report that initially boosted optimism but raised concerns about the Federal Reserve's interest rate plans [2] Energy Sector - Following a U.S. military strike and the capture of Venezuelan President Nicolás Maduro, President Trump announced plans to "unlock Venezuela's vast crude oil reserves," leading to a surge in the S&P 500 energy index by 2.7% [3] - Major companies like Chevron and Exxon Mobil saw significant stock increases, with Chevron rising 5.1% and Exxon Mobil increasing by 2.2% [3] - However, oil prices fell shortly after the announcement, with Brent crude futures dropping 0.5% to $60.39 per barrel and U.S. West Texas Intermediate crude decreasing 1.4% to $56.36 per barrel [5] Corporate Reactions - Industry executives from Chevron, ConocoPhillips, and ExxonMobil reportedly denied having discussions about investing in Venezuela, indicating a disconnect between presidential aspirations and corporate realities [6] - Chevron's stock is currently at $182.28, and Exxon Mobil is at $156.57, reflecting a +3.31% move since the market opened [6] Tariff Implications - The Trump administration's proposed tariffs on Canadian aircraft and auto imports have raised concerns in the automotive sector, with potential cost increases of $5 billion annually for the Canadian automotive industry [8] - General Motors' stock was down 8% following initial tariff news but rebounded 4% on speculation of delays, currently trading at $80.36 [9] Economic Predictions - Trump's prediction of the Dow reaching 100,000 by 2029 is viewed as ambitious, given the current level around 50,000 [11] - The automotive sector is particularly sensitive to tariff threats, with analysts warning that tariffs could lead to inflation and reduced car sales [8][10]

Core Viewpoint - Energy stocks, particularly ExxonMobil, are currently performing well, with ExxonMobil's market capitalization reaching $639 billion and showing a year-to-date increase of 23.9% [2][8]. Group 1: ExxonMobil's Performance - ExxonMobil is identified as a leading candidate to potentially reach a $1 trillion market cap by 2030, benefiting from increased oil and gas demand [2]. - The company has a highly efficient production portfolio and anticipates 13% average earnings growth and double-digit cash flow growth per year through 2030, based on conservative oil price assumptions [11]. - Despite lower oil prices affecting upstream earnings, ExxonMobil's energy products segment, including refining, saw an 84% increase in earnings from $4.03 billion to $7.42 billion in 2025 [14]. Group 2: Industry Context - The energy sector has been the best-performing sector year to date, largely driven by ExxonMobil, the largest component in this sector [4]. - Other sectors such as materials, consumer staples, and industrials have also performed well, while high-growth sectors like technology and communication services have seen declines [6]. - The skepticism surrounding high valuations in AI growth stocks has led to a pause in investment, contrasting with the strong performance of energy stocks [7]. Group 3: Investment Considerations - ExxonMobil is characterized as a reliable dividend-paying value stock, with 43 consecutive years of dividend increases and a current yield of 2.8% [15]. - The company's valuation metrics, including a price-to-free cash flow ratio of 27.2 and a price-to-earnings ratio of 22.3, indicate an elevated valuation compared to its historical medians, yet it is considered a higher-quality company today [15].

Company Overview - Exxon Mobil Corporation (NYSE:XOM) is one of the largest integrated energy companies globally, involved in oil and gas exploration, production, refining, and the production of fuels, petrochemicals, lubricants, and specialty plastics. The company is also investing in lower-emission businesses such as carbon capture and lithium development [5]. Financial Performance - In 2025, Exxon reported earnings of $28.8 billion and generated $52 billion in operating cash flow, maintaining its position at the top of the industry. Since 2019, the company's earnings per share have grown at a compound annual rate of 21%, while operating cash flow has increased at a 10% annual pace [2]. - The company achieved $3 billion in structural savings last year, bringing total savings since 2019 to $15.1 billion, which exceeds the combined total savings of other international oil companies during the same period [4]. Production Highlights - Exxon reached a production level of 4.7 million barrels of oil equivalent per day, the highest output in over four decades. Significant production records were set in the Permian Basin and offshore Guyana, where the company has focused its capital on high-margin barrels [3]. Analyst Ratings - Mizuho raised its price target for Exxon Mobil from $132 to $140 while maintaining a Neutral rating on the stock. This adjustment followed the company's Q4 report, which led to a revision of Mizuho's financial model [1].

Investment Strategy - The focus is on creating a stable flow of retirement income through a unique strategy developed by the founder's father, which has proven effective over time [5][6] - The investment approach includes three income portfolios with risk levels ranging from 5% to 12%, and two growth portfolios aimed at capital gains [6][7] - The strategy emphasizes capital preservation, aiming to maintain a majority of funds in dependable stocks with yields of 5% to 7% as retirement approaches [7][11] Portfolio Management - The growth side of the portfolio is gradually reduced over time, with a small percentage retained for potential high returns, exemplified by Tesla's significant growth [8] - In the previous year, the strategy successfully harvested approximately $173,000 in profits from stocks like Nvidia, which were then redeployed into income-generating assets [10] - The approach includes taking profits from high-performing stocks and reallocating them to maintain a balanced income stream [10][19] Market Insights - The energy sector was identified as a major loser in the previous year, but has since rebounded, with stocks like ExxonMobil and Chevron showing significant gains [13][15] - The current market is characterized by high volatility, with the Fed's hawkish statements and upcoming economic data being critical factors to watch [32][34] - Concerns about employment weakening due to AI advancements are noted, with the upcoming employment report expected to be significant for market direction [34] Tax Considerations - Tax loss harvesting is a strategy employed to offset gains with losses, influencing stock movements at the beginning of the year [52][53] - The earnings season has shown a trend where stocks reporting good earnings are still experiencing sell-offs, indicating a cautious market environment [55] Long-term Perspective - Emphasis is placed on maintaining a long-term investment perspective amidst market noise and volatility, with a focus on high-conviction holdings [37][63] - Historical market recoveries are highlighted as a reassurance for investors during downturns, encouraging patience and strategic decision-making [60][62]

Core Viewpoint - Exxon Mobil Corporation (XOM) is currently viewed as expensive relative to its peers and the broader industry, trading at a 9.78x trailing 12-month EV/EBITDA compared to the industry average of 5.87x and BP at 3.33x and Chevron at 9.52x [1][8]. Group 1: Valuation and Market Confidence - The premium valuation of XOM indicates strong market confidence in its future prospects, necessitating a thorough evaluation of its fundamentals and growth potential to determine if the valuation is justified [3]. Group 2: Upstream Assets and Production Outlook - XOM has significant upstream assets in the Permian Basin and offshore Guyana, utilizing lightweight proppant technology to enhance well recoveries by up to 20% [4]. - The company has made several discoveries in Guyana, contributing to a solid production outlook, with low breakeven costs allowing continued operations even in low crude price environments [5]. - ExxonMobil projects total production from upstream operations to reach 5.5 million oil equivalent barrels per day by the end of the decade, with 65% of this volume coming from its key assets [6]. Group 3: Refining Operations and Capital Strategy - XOM's refining operations provide resilience during periods of low oil prices, with significant improvements in margins and throughput expected in 2025 [7]. - The company maintains a conservative capital spending strategy while enhancing productivity, anticipating improved earnings and cash flows without increasing capital expenditures [9]. Group 4: Financial Returns and Shareholder Value - By the end of the decade, XOM expects its return on capital employed (ROCE) to exceed 17%, and it is the second-largest dividend payer in the S&P 500, having increased dividends for over four decades [10]. - The company has an aggressive share buyback program, reflecting its commitment to returning capital to shareholders [10]. Group 5: Stock Performance and Market Risks - Over the past year, XOM's stock has increased by 41.2%, outperforming the industry's composite growth of 26.5% and the growth of BP and Chevron [12]. - However, XOM's earnings are heavily reliant on upstream operations, making it vulnerable to commodity price volatility, with expectations of declining oil prices this year potentially impacting its business [16].

Core Viewpoint - ExxonMobil warns that new EU regulations aimed at curbing methane emissions could increase crude oil import costs by approximately 13% and significantly impact the industrial base in the region [1] Group 1: Regulatory Impact - The current situation suggests that about 80% of the EU's crude oil imports will not meet the EU's methane emission standards by 2027 [1] - If the EU seeks to source crude oil from compliant but smaller supply sources, the average import price per barrel is expected to rise by about $9 [1]

Economic Indicators - The U.S. unemployment rate improved last month, with employers adding 130,000 jobs, exceeding economists' expectations [2][5] - The strong job data raises hopes for a solid U.S. economy, potentially driving profits for companies, particularly in the energy and raw-material sectors [3][4] Market Reactions - The S&P 500 initially rose but finished with a slight dip of less than 0.1%, while the Dow Jones Industrial Average dropped 66 points (0.1%) and the Nasdaq composite fell 0.2% [1] - Stocks in the energy sector, such as Exxon Mobil, saw gains, with Exxon climbing 2.6% [4] Federal Reserve Implications - Stronger-than-expected job data may delay interest rate cuts by the Federal Reserve, which could negatively impact stock prices and other investments [4][5] - Traders adjusted their expectations for when the Fed might begin cutting interest rates, pushing bets further into the summer [5] Treasury Yields - Following the jobs report, the yield on the 10-year Treasury rose to 4.17% from 4.16%, while the two-year Treasury yield increased to 3.51% from 3.45% [6]

European Union rules intended to curb emissions of methane, a potent greenhouse gas, could add about 13% to the cost of crude oil imports and deal a hammer blow to the bloc’s industrial base, Exxon Mobil warned ahead of a meeting of leaders https://t.co/5DhxsNjDnB ...

Core Viewpoint - ExxonMobil has announced the early shutdown of its Fife Ethylene Plant in Mossmoran, Scotland, which was initially scheduled for permanent closure in the third quarter of 2026, indicating a shift in operational strategy in response to economic assessments and market pressures [1] Group 1: Company Actions - The Fife Ethylene Plant has an ethylene production capacity of approximately 830,000 tons per year, making it a significant chemical infrastructure in the UK [1] - The decision to close the plant ahead of schedule is part of ExxonMobil's global asset optimization strategy, focusing on core assets with competitive advantages [1] Group 2: Market Impact - The early closure is expected to affect the local ethylene supply landscape and may further influence the European ethylene market [1] - Analysts suggest that the decision is influenced by multiple factors, including economic evaluations of the facility, cost pressures in Europe, and broader strategic adjustments within the company [1]