This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

The Day Exxon Mobil Became a T-Bill

Exxon Mobil's dividend announcement led to some skepticism that the company was trying to get out ahead of the bad earnings report with a cash reward to shareholders, even if quarterly profits again trumped the annual GDP of several nations.

There's no need to be so skeptical, though: An increasing dividend profile is really all these companies can offer, and it's typical for them to release the dividend news ahead of earnings, too. What Exxon reported earnings-wise should have been expected.

Exxon, even as the biggest of the Big Oil bunch, is oddly the odd man out in many categories versus peers. It's not just the dividend laggard -- even after its big raise this quarter - but it has a worse profitability per barrel of oil than Chevron and has a less flattering oil vs. natural gas production mix than peers. Yet Exxon Mobil trades at a premium to peers, a premium that is eroding.

Which is why I say that this week, and this earnings day, was an apocalyptic one for a company in a sector mired in the existential crisis of imperial proportions. For all of the hard, nasty, dangerous and expensive work of trying to keep ahead of world demand for oil through its far flung global production search, diving ever deeper into the deep of the sea and this way and that way through the boomtown shale basins of the Dakotas and Poland, Exxon Mobil's big market enticement is a yield that beats t-bills.

Welcome to the world of sovereign nations, Exxon Mobil. And enjoy the yield, investors. A lot of work goes into beating the U.S. government.

-- Written by Eric Rosenbaum from New York.

>To contact the writer of this article, click here: Eric Rosenbaum.

>To follow the writer on Twitter, go to Eric Rosenbaum.

Follow TheStreet on Twitter and become a fan on Facebook.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Submit an article to us!
SYM TRADE IT LAST %CHG
XOM $88.85 0.00%
AAPL $128.95 0.00%
FB $78.99 0.00%
GOOG $537.90 0.00%
TSLA $226.03 0.00%

Markets

DOW 18,024.06 +183.54 1.03%
S&P 500 2,108.29 +22.78 1.09%
NASDAQ 5,005.3910 +63.9670 1.29%

Partners Compare Online Brokers

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs