Exxon Mobil Corporation (XOM) A Stock to Buy on Insider Confidence?

The Exxon Mobil Corporation (NYSE:XOM) bears won the day, but the reality is that the -0.58 points or -0.77 percent decline gave very little definitive technical indication of where the stock could be headed next. On 07 February, the shares traded at $74.68 with a light trade volume of 14.287 million shares. After opening the session at $74.95, the shares went as high as $75.19 and as low as $73.9, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $319 billion and now has 4.27 billion shares outstanding. Exxon Mobil Corporation (XOM) stock has gained 3.66 percent of market value in 21 trading days.

XOM stock has a trailing 3-year beta of 0.88, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $4.05 a share in the trailing twelve months. The stock’s value has surged 9.52 percent year to date (YTD) against a decline of -4.68 percent in 12 month’s time. The company’s shares still trade -14.51 percent away from its 1-year high of $87.36 and 15.51 percent up from 52-week low of $64.65. The average consensus rating on the company is 2.8, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a sell.

Exxon Mobil Corporation (XOM) will probably climb 11.13 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $100 price as 12-month high target. This represents a whopping 33.9 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $81.5, which represents a return potential of 9.13 percent when compared to the closing price of the stock of $74.68 on Thursday, February 07. The lowest price target for the stock is $70 — slightly more than -6.27 percent from XOM’s current share price.

History has shown that shares in Exxon Mobil Corporation have gone down on 21 different earnings reaction days and are predicted to add 0.01 percent when the company reports upcoming earnings. Investors will get their next glimpse of XOM’s Q1 earnings on April 26. Analysts are forecasting revenue to climb 17.8 percent to $78.4B in the fiscal first quarter, while earnings are seen soaring by nearly 22.73 percent to $1.08 per share. It earned $1.46 per share, better than the $1.23, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $71.9B, worse than the $77.3B analysts expected. Earnings are estimated to increase by 72.4 percent this year, -4.09 percent next year and continue to increase by 19 percent annually for the next 5 years.

Let’s take a look at some insider activity at Exxon Mobil Corporation (NYSE:XOM) and see the pattern. The earliest insider trade took place on 12/19/2018. Corson Bradley W parted with a total of 15 thousand shares of company at average share price of $72.84. The total for the sales was set at $1.09 million. After this transaction, the Vice President account balance stood at 248.71 thousand shares. The stock grew 3.32 percent since that insider sale. On 12/14/2018, Hansen Neil A, Vice President and Secretary, sold 2.8 thousand shares at a price per share of $76.81. This removed 214.91 thousand shares from the insider’s fortune and the stock saw a -2.02 percent retreat in value since the news became public. This transaction left 33.35 thousand shares in the Vice President and Secretary account.

On 12/11/2018, Executive Officer Verity John R performed a sale transaction worth $1.22 million. This sale at $76.94 each has eliminated 15.85 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -2.18 percent decrease since the transaction was reported. The insider now is left with 151.34 thousand shares remaining in the account. Rosenthal David S, who performs the Vice President and Controller job, sold 7.56 thousand shares for $614.34 thousand. The disposal occurred on 12/04/2018 was priced at $81.24 per share. The share price plunged -7.36 percent since the reporting date. Rosenthal David S now left with a stake of 288.9 thousand XOM stock worth $21.58 million after the insider selling.

The stock is currently hovering around the first support level of $73.99. Below this, the next support is placed in the zone of $73.3. Till the time, the XOM stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 55.5 on daily chart, which may remain a cause for concern. If the price breaks below $73.3 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $75.28 mark may result into a pull-back move towards $75.88 level.

Shares of Exxon Mobil Corporation (XOM) are trading at a P/E ratio of 15.44 times earnings reported for the past 12 months. The industry XOM operates in has an average P/E of 22.96. Its P/E ratio went as low as 12.17X and as high as 48.09 over the 5-year span.Further, it is sporting a 1.22 on the Price-to-Sales ratio. Compare this with the industry average P/S of 0.9. 33.2 percent is the gross profit margin for Exxon Mobil Corporation and operating margin sits at 6.9 percent. Along with this, the net profit margin is 8.9 percent.