The most you can lose on any stock (assuming you don't use leverage) is 100% of your money. But when you pick a company that is really flourishing, you can make more than 100%. To wit, the Exxon Mobil Corporation (NYSE:XOM) share price has flown 180% in the last three years. Most would be happy with that. Better yet, the share price has risen 5.9% in the last week. But this could be related to the buoyant market which is up about 3.7% in a week.
After a strong gain in the past week, it's worth seeing if longer term returns have been driven by improving fundamentals.
View our latest analysis for Exxon Mobil
While the efficient markets hypothesis continues to be taught by some, it has been proven that markets are over-reactive dynamic systems, and investors are not always rational. One flawed but reasonable way to assess how sentiment around a company has changed is to compare the earnings per share (EPS) with the share price.
Exxon Mobil was able to grow its EPS at 60% per year over three years, sending the share price higher. This EPS growth is higher than the 41% average annual increase in the share price. So one could reasonably conclude that the market has cooled on the stock. We'd venture the lowish P/E ratio of 8.01 also reflects the negative sentiment around the stock.
The graphic below depicts how EPS has changed over time (unveil the exact values by clicking on the image).
It is of course excellent to see how Exxon Mobil has grown profits over the years, but the future is more important for shareholders. This free interactive report on Exxon Mobil's balance sheet strength is a great place to start, if you want to investigate the stock further.
What About Dividends?
It is important to consider the total shareholder return, as well as the share price return, for any given stock. The TSR incorporates the value of any spin-offs or discounted capital raisings, along with any dividends, based on the assumption that the dividends are reinvested. Arguably, the TSR gives a more comprehensive picture of the return generated by a stock. In the case of Exxon Mobil, it has a TSR of 231% for the last 3 years. That exceeds its share price return that we previously mentioned. The dividends paid by the company have thusly boosted the total shareholder return.
A Different Perspective
We're pleased to report that Exxon Mobil shareholders have received a total shareholder return of 37% over one year. And that does include the dividend. Since the one-year TSR is better than the five-year TSR (the latter coming in at 14% per year), it would seem that the stock's performance has improved in recent times. Given the share price momentum remains strong, it might be worth taking a closer look at the stock, lest you miss an opportunity. It's always interesting to track share price performance over the longer term. But to understand Exxon Mobil better, we need to consider many other factors. Case in point: We've spotted 2 warning signs for Exxon Mobil you should be aware of, and 1 of them can't be ignored.
If you are like me, then you will not want to miss this free list of growing companies that insiders are buying.
Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on American exchanges.
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Join A Paid User Research Session
You’ll receive a US$30 Amazon Gift card for 1 hour of your time while helping us build better investing tools for the individual investors like yourself. Sign up here
https://news.google.com/rss/articles/CBMiRmh0dHBzOi8vZmluYW5jZS55YWhvby5jb20vbmV3cy9leHhvbi1tb2JpbHMtbnlzZS14b20tNDktMTQwMDIyOTc3Lmh0bWzSAU5odHRwczovL2ZpbmFuY2UueWFob28uY29tL2FtcGh0bWwvbmV3cy9leHhvbi1tb2JpbHMtbnlzZS14b20tNDktMTQwMDIyOTc3Lmh0bWw?oc=5
2023-04-02 14:00:22Z
CBMiRmh0dHBzOi8vZmluYW5jZS55YWhvby5jb20vbmV3cy9leHhvbi1tb2JpbHMtbnlzZS14b20tNDktMTQwMDIyOTc3Lmh0bWzSAU5odHRwczovL2ZpbmFuY2UueWFob28uY29tL2FtcGh0bWwvbmV3cy9leHhvbi1tb2JpbHMtbnlzZS14b20tNDktMTQwMDIyOTc3Lmh0bWw
Bagikan Berita Ini
0 Response to "Exxon Mobil's (NYSE:XOM) 49% CAGR outpaced the company's earnings growth over the same three-year period - Yahoo Finance"
Post a Comment