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XOM, a 46% higher target price
Current 62 Target 90 +46%
December 15th 2021
1 minute read
Sales up 9%
Costs 2 points lower, profit higher
Cashflow higher
Balance sheet, lower leverage
Valuation, a 46% higher target price
1 minute read
Sales up 9%
- Sales were up 9% in the third quarter to 73,786 million dollars vs our 67,741million dollars forecast.
- This brings the quarterly average to 13% growth.
- We predict average growth of 3% in this next 12 months to bring sales to 82,162 million dollars in the third quarter of 2022.
Costs 2 points lower, profit higher
- The cash cost ratio was at -84% in the third quarter giving a higher 6,942 million dollars net profit.
- The average cost ratio is at -86% now.
- We use the average -86% cost ratio to predict a 6,451 million dollars profit in the third quarter of 2022.
Cashflow higher
- Free cashflow was higher at 8,878 million dollars in the third quarter with higher -3,054 million dollars investment Cashflow.
- Average quarterly Cashflow is at 4,770 million dollars now.
- We assume the same -3,054 million dollars investment spending which with higher sales gives a 8,387 million dollars Cashflow in the third quarter of 2022.
Balance sheet, lower leverage
- Cash increased from 3,465 to 4,768 million dollars in the third quarter.
- Liabilities declined from 171,733 to 169,182 million dollars so net cash improved from -168,268 to -164,414 million dollars.
- With our forecast cashflow & a -2,395 million dollars equity payout net cash will be -135,113 million dollars in 12 months time.
Valuation, a 46% higher target price
- XOM capital from the last 27 quarters was up to 74,703 million dollars in the third quarter with a -3,619 million dollars liabilities payment & a -3,869 million dollars equity payout & will rise to 106,399 million dollars in12 months time.
- At the current market value of 260,500 million dollars based on our forecasts it’s at 0.79 X assets with a 10.5 years payback & a 1% yield.
- Our 12 month cashflow forecast is 31,696 million dollars which means an 8 X valuation. A 12 X valuation gives a 46% higher target price of 90 dollars.
