On Jan 18, UBS analyst Jon Rigby has downgraded ExxonMobil stock to sell. However, on Sep 6, the integrated energy firm's rating was lifted to neutral. Also, Rigby raised ExxonMobil's target price from $75 to $76.
After touching the lowest closing price of $76.10 in 19 months on Aug 30, ExxonMobil gained almost 4% over the last five days. Hence, the rating upgrade helped ExxonMobil to maintain its winning streak.
On Sep 6, among all the components of Dow Jones Industrial Average, ExxonMobil gained the maximum after the likes of The Home Depot HD , Chevron CVX and Intel INTC . Shares of ExxonMobil rose slightly more than 2%, while Home Depot, Chevron and Intel rallied a respective 2.4%, 2.2% and 2.1%. It can also be concluded that ExxonMobil's rally had considerably backed Dow Jones' 54.33 points increase on the day.
It is to be noted that the rating upgrade had come despite ExxonMobil's 12.5% decline on a year-to-date basis, underperforming the industry's 4% fall. Rigby projects a gradual improvement in crude price and margins from downstream business on rising demand. These favorable macro-economic scenarios will support ExxonMobil, according to the UBS analyst.
However, dependence on costly offshore drilling might dent ExxonMobil's cashflow.
As a result, the company currently carries a Zacks Rank #3 (Hold), implying that the stock will perform in line with the broader U.S. equity market over the next one to three months. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
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