Do you think EXXON stock will dip in price now that gasoline inventories are stabalizing?

Question

Please share your opinions. I am thinking it will dip a little bit starting in June and rise again late fall.

Peace,

Answer 1

No, it will stay up all summer.

Answer 2

When looking into a stock you should look into the company before you factor in anything else. Exxon-Mobil is the largest fortune 500 company in the USA. They are a very solid company, and very profitable. With that said, there are other things you need to factor in before you buy or sell OXM.

First, when a company is established as much as Exxon, you are not going to see much “growth” out of the stock. With the gas prices going up so fast, the stock has shown an unusual return. I feel that the stock has gone up so fast because there are a lot of odd lots currently buying this security. An odd lot is when someone buys a stock out side of a 100 shares. It is said that “odd lot buyer” are not good investors. This is because they buy to a “dollar” figure and not to an amount of shares. Meaning they do not have enough money to buy 100, 200, 900, 1500 shares, but they buy $5000 or $25000 worth of a stock and they get as many shares they can afford. It has been shown in the past that when the stock turns quickly downward, the odd lots are the first to sell the security, and it will force the price even lower. Currently OXM has a lot of odd lots.

Next, when buying a “blue chip” company you look for stability and income. This is more of a value investment then a “growth” investment. Some people hold on to OXM for income, and others use it to hedge.

With any gas company, they buy there supply of gas/oil years before they actually sell it to the public. For example, Exxon might have bought the oil they are selling today 3 years ago. So, they are making a much higher profit margin today because oil is trading higher today then when they purchased the oil. They can “get away with this” because they still need to buy oil today for the future.

XOM has a buy sell of 1.33 out of 24 analysts. (1 means strong buy and 3 means strong sell). That is a solid buy rating for a blue chip stock. Morning star has given XOM a hold as of 5-8-07, McDep Associates has a strong buy as of 5-10-07 and Merrill Lynch has a light buy to hold as of 4-27-07.

Hope that helped.

Answer 3

personally I think XOM is more likly to fall from here than to rise, gasoline improts have been really high and todays report had it in the top three weeks all time. The crack spread has been dropping off of very high levels. However, many non OPEC nations have been having trouble bringing on new supply which was expected so this could hold oil and gas prices higher, China shows little sign of a slow down and RIO announce today that they expected iron ore orders to increase at a faster than expected rate signaling that chinese growth could be accelerating from already high levels. That said the Chinese govt is take real steps to slow the economy for the first time. All said XOM is a hard call but for my money it has a better chance of going down than up and could fall more than it could rise so I think there are better places to allocate capital at the moment.

Answer 4

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Answer 5

I may be talking a bit above my head here, but I read recently that Exxon has decided to buy large amounts of its stock back. This will artificially drive up the price of it's stock.

Additionally, buying stock instead of reinvesting the available funds into new plants should keep gas prices high (more plants obviously would lower gas prices). What jerks...but you gotta admire their strategy!

Maybe this is old news (apologies).

Answer 6

I know alot of "money" is going into Large Cap companies such as Exxon. Companies like this have been out of favor, but now investors are seeing potential. But do your HW.