Market Overview

UBS: Exxon And Chevron Are Trading At Historically High Valuations

Share:

In a pair of recent reports, analysts at UBS gave their take on Exxon Mobil Corporation (NYSE: XOM) and Chevron Corporation (NYSE: CVX) following Exxon's recent analyst meeting.

Overall, UBS remained neutral on both names.

Exxon

Exxon's recently-revealed capex budget for 2015 is about $34 billion, in line with expectations and longer-term guidance. The 2015 capex number represents about a 12 percent year-over-year (Y/Y) decline for the company.

On the production front, Exxon disclosed a target of 4.1 MMBoed for 2015, in line with previous guidance and a 2.2 percent increase over 2014 production levels. The only change to the company's production outlook was a slight adjustment in the mix, favoring more liquids over gas.

Related Link: Oppenheimer Says BP Is Worth $50/Share, But Why?

Analysts point out that Exxon's stock is currently trading at a premium to its historical valuation. Its relative price to earnings ratio (PE) of 1.0x versus the overall S&P is well above its historical 0.8x average.

Analysts have a price target of $92 on Exxon's stock.

Chevron

Chevron's analysts day is coming up on March 10. Analysts predict that the company will maintain its current guidance, including a 16 percent Y/Y reduction in capex to about $31 billion.

UBS is expecting Y/Y production growth of 0 to 3 percent and a long-term volume target of 3.1 MMBoed for Chevron.

Chevron's stock is also currently trading at a premium to its historical valuation relative to the S&P. Chevron's relative PE of 0.93x is well above its historical average of 0.66x.

Analysts have a price target of $108 on Chevron's stock.

Latest Ratings for XOM

DateFirmActionFromTo
Feb 2020MaintainsNeutral
Feb 2020DowngradesNeutralSell
Jan 2020MaintainsHold

View More Analyst Ratings for XOM
View the Latest Analyst Ratings

Posted-In: Analyst Color Price Target Commodities Markets Analyst Ratings

 

Related Articles (CVX + XOM)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
ECLCFRAMaintains195.0
BENCFRAMaintains29.0
LMCFRAMaintains50.0
TTWOCFRAMaintains132.0
WMTCFRAMaintains130.0
View the Latest Analytics Ratings
Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com