“This is not a stock for a very bullish view on oil prices. If you are a bull on crude, there are more aggressive generally smaller-cap names in the oil and gas arena for people to focus on,” Molchanov said. “Exxon is so appealing because it’s defensive and it tends to outperform when all is going down, not going up.”
The boom in natural gas and Exxon’s generous dividend — which analyst Jason Gammel at Macquarie Securities points out returns more than the Standard & Poor’s 500 Index — also makes the company a “buy.”
“Moving forward we do think [natural gas] is an important source of production and reserve growth for the company,” said Gammel, who also rates the stock an “outperform,” with a price target of $97. “I do think that the position they’ve carved out in natural gas is going to be very important for the long-term story here.”
—By Javier E. David, Special to CNBC.com
Additional Views: Dennis Gartman: Tapping SPR Could Drive Oil to New Highs
Additional Views: Despite Earnings Miss, Exxon Still a ‘Buy’: Analyst
CNBC Data Pages:
Neither Pavel Molchanov nor Jason Gammel own shares of XOM.