Canaccord Genuity Morning Coffee on Exxon Mobil (XOM): Hope for Higher Dividend
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Price: $165.91 -0.14%
Rating Summary:
16 Buy, 23 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
16 Buy, 23 Hold, 1 Sell
Rating Trend:
Down
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Canaccord Genuity Morning Coffee on Exxon Mobil (NYSE: XOM): Hope for higher dividend.
The world's largest oil company is expected to announce its annual dividend increase in the next couple weeks and at least one analyst is expecting a significant increase. With $55 billion in cash flow, $37 billion in capital expenditures and a $9-billion dividend obligation for fiscal 2012 an analyst at JPMorgan told clients Thursday that Exxon “has ample cash flexibility” to boost its yield by 50% while “still maintaining a relatively healthy cushion.” The Financial Post highlights that because Exxon has generally preferred to return cash to shareholders in the form of share buybacks, the company's most recent dividend payout of $0.47 per share represented a yield of just 2.2%, significantly lower than the 3.7% average for peers Chevron (NYSE: CVX), BP (NYSE: BP) and Royal Dutch Shell (NYSE: RDS.A). The JPMorgan analyst upgraded her rating on Exxon stock and stated that an increase to 3.2% was reasonable and would only add about $4 billion to Exxon’s annual dividend obligation going forward.
The world's largest oil company is expected to announce its annual dividend increase in the next couple weeks and at least one analyst is expecting a significant increase. With $55 billion in cash flow, $37 billion in capital expenditures and a $9-billion dividend obligation for fiscal 2012 an analyst at JPMorgan told clients Thursday that Exxon “has ample cash flexibility” to boost its yield by 50% while “still maintaining a relatively healthy cushion.” The Financial Post highlights that because Exxon has generally preferred to return cash to shareholders in the form of share buybacks, the company's most recent dividend payout of $0.47 per share represented a yield of just 2.2%, significantly lower than the 3.7% average for peers Chevron (NYSE: CVX), BP (NYSE: BP) and Royal Dutch Shell (NYSE: RDS.A). The JPMorgan analyst upgraded her rating on Exxon stock and stated that an increase to 3.2% was reasonable and would only add about $4 billion to Exxon’s annual dividend obligation going forward.
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