Tim Brown: Keep Your Eyes on Exxon

Each day since the announcement last Thursday, Exxon has closed the session lower than it started. Yesterday was the worst, losing $3.12 a share of 3.19% to close at $76.60. Yesterday, it hit a new 52-week low. The stock has declined more than 8% in the last year. Contributing to its decline was news that crude oil closed down significantly.

The stock has developed a nice little pattern in recent quarters. It delivers its earnings announcement, the stock falls for a bit and then comes back. The last two quarters it has fallen for about a week following the quarterly numbers and it slumped for about two weeks the quarter before that. That's because as well as the company has performed, the Street wanted more.

But it is important to take a step back and really look under the hood. This company is solid. It's got revenue of $389 billion and a boatload of cash on hand -- $41.39 billion to be exact. Its operating cash flow stands at $59.14 billion. Lastly, it has a forward price-to-earnings ratio of just 7.39 and a return on equity (ROE) of more than 35%.

This company is a good one, and one that I am going to continue to watch during the next day or so. The stats don't lie; this company is built on a solid foundation. However, I am going to be careful here. As much as I like this company, I want to see how it will react for a day or two more. I don't want to be buying if yesterday's drop in oil is the start of a larger trend.

A few days should give me the time I need to assess whether I want to go ahead or not. Plus, as I noted above, the stock has fallen for about a week following its last two earnings announcements. It reported its earnings on July 31, so this timeline fits in with that as well.

Keep moving the chains!

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