To The Moon

Key Drivers for 2025 Performance

Oil Prices and Demand

Bull Case: Oil demand remains robust, supported by economic recovery and tight supply. OPEC+ cuts and geopolitical tensions (e.g., Russia-Ukraine) could keep Brent crude above $80/barrel, boosting ExxonMobil’s upstream earnings. Analysts like those at LongForecast project oil stabilizing at $60-$80, with spikes possible, aligning with ExxonMobil’s historical earnings sensitivity (EPS ~$13 at $100 oil per InvestorPlace, October 2023).

Bear Case: Global supply increases (e.g., non-OPEC production) and a potential demand peak (ExxonMobil’s own 2050 Outlook) could cap oil at $60-$70, pressuring margins. J.P. Morgan’s November 2024 warning of trade war volatility adds downside risk.

Financial Strength

2024 Results: ExxonMobil reported $33.7 billion in earnings and $55 billion in operating cash flow (January 31, 2025, corporate release), down from $36 billion in 2023 but still industry-leading. Structural cost savings of $12.1 billion since 2019 offset inflation, with a target of $18 billion by 2030.

Balance Sheet: Debt-to-capital ratio at 13%, net-debt-to-capital at 6%, and $23.2 billion in cash (end of 2024) provide resilience. X posts (e.g., LynAldenContact, 2023) highlight ExxonMobil’s cash hoard benefiting from rising rates, a trend continuing into 2025.

Strategic Moves

Pioneer Merger: Closed in Q2 2024, this $59.5 billion deal boosts Permian Basin output from 1.5M to 2.3M barrels/day by 2030, enhancing efficiency and emissions cuts (ExxonMobil, December 2024). Analysts see double-digit returns here.

Low-Carbon Bets: $27-$29 billion capex in 2025 (rising to $28-$33 billion annually 2026-2030) includes carbon capture, hydrogen, and lithium ventures (e.g., Baytown hydrogen facility, startup 2029). These diversify revenue but face policy and tech risks.

Guyana Growth: Record production in 2024 sets a foundation for 650K barrels/day by 2030, a low-cost, high-margin asset.

Risks

Energy Transition: Secular shift to renewables (noted in Simply Wall St, December 2024) threatens fossil fuel reliance. ExxonMobil’s $30 billion low-emission spend (2025-2030) mitigates this but hinges on unproven returns.

Regulatory/Trade: Guyana cost disputes ($214.4M adjustment, X post by TamanishaJohn, March 11) and Trump-era tariffs (Morgan Stanley, November 2024) could hit margins.

Volatility: Oil price swings and a potential recession (InvestorPlace, October 2023) cap upside.

Current Dividend Details

Quarterly Dividend: $0.99 per share, announced October 31, 2024, payable March 10, 2025 (for shareholders of record February 12, 2025).

Annual Dividend: $3.96 per share ($0.99 × 4).

Yield: Approximately 3.6%, based on a stock price of $108.92 (recent web data and X posts reflecting a dip from $126.34 in October 2024).

Increase: Up 4.2% from the prior $0.95/share, marking the 42nd consecutive year of dividend growth—a Dividend Aristocrat streak.

Historical Context

Track Record: ExxonMobil has raised its dividend annually since 1983, surviving oil crashes (e.g., 1986, 2008, 2020). In 2020, it maintained payouts despite a $22.4 billion loss, prioritizing shareholder returns over balance sheet deleveraging.

ExxonMobil’s dividend policy in 2025 is a bedrock of stability, not a catalyst for outsized gains. Expect a $4.08-$4.12 annual payout (3-4% hike), fully covered by cash flow unless oil crashes below $60. It’s a defensive play—ideal for income-focused portfolios, less so for growth chasers. The Pioneer merger and Guyana growth bolster its foundation, but don’t expect aggressive hikes; management prioritizes the streak over splashy increases.