Exxon was added to our Best Stocks list last week. Its fundamentals are bottoming at the right time
HS 13/11/2025
(This is The Best Stocks in the Market , brought to you by Josh Brown and Sean Russo of Ritholtz Wealth Management.) Josh — Some stocks move swiftly, changing direction frequently, darting to and fro, uptrends turn to downtrends turn back to uptrends. Other stocks — pardon the analogy — move more like an oil tanker. These do not change course very often and can be tough to turn. But once they do, you want to be on the right side of the trade. The oil tanker I want to tell you about today is Exxon Mobil (XOM) , arriving last week on the Best Stocks in the Market list, possibly just before a major breakout above long-term resistance. When Exxon reported its third-quarter earnings on Oct. 31, management relayed to shareholders that it had reached a new record for upstream production, with 4.8 million barrels per day including 1.8 billion from the Permian and another 700,000 in Guyana. The company also highlighted strong shareholder returns with $9.4 billion in capital returned to shareholders, including $4.2 billion in dividends and $5.1 billion in share repurchases. They declared a Q4 dividend of $1.03 per share, which will be a 4% increase. Of equal importance is the fact that they’ve been able to deliver on cost-cutting. Given the relatively weaker energy prices we’re seeing worldwide, this is really all they can do. Exxon can no more control the price of a barrel of oil than you or I can control the weather this weekend. Management has been making steady progress on the cost side which will mean increasing earnings during the next commodity price bull market. Since 2019, the company has achieved $14 billion in cumulative structural cost savings — $2.2 billion of that in 2025 year to date. Sean’s going to get into some more on what’s happening with the company and I will take a closer look at the chart for you. Best Stock spotlight: Exxon Mobil (XOM) On the list since: Nov. 7, 2025 One-year price chart: Sean — XOM earnings peaked during what was an exceptional year in 2022 for oil companies. In Q3 2022, earnings hit $19.7 billion for the quarter. Since then, earnings have stabilized in the $7 billion-$9 billion range per quarter. In the most recent quarter, XOM reported about $7.8 billion in net income, totaling year-to-date earnings of $22.3 billion, down from $26.1 billion over the same period last year due to lower oil prices and higher costs. That growth deceleration is changing. There are 10 key projects due to be completed in 2025 that are expected to drive more than $3 billion in earnings contributions at constant prices and margins. Exxon also has a new growth driver on the way: liquefied natural gas. The U.S. is currently the largest LNG producer and it’s about to get larger. The “Golden Pass” LNG export terminal in Texas is owned by both XOM and QatarEnergy. It is set to begin operations at the end of 2025 and will have capacity of more than 18 million metric tons per year when fully operational, according to the company. XOM’s CEO, on their latest earnings call, noted that this project and others are expected to form a “foundation” for 2030 earnings and cash flow plans. We’ve discussed the improvements oil and gas companies have been making in terms of the cost of production. The goal used to be to produce as much oil at all costs. Now it is to produce the most oil at the lowest cost, and send the cost savings back to the shareholders. Historical reinvestment rates averaged 70% from 2010-2019, current investment levels as a percentage of cash flow are around 45-55% with further decline expected in the 35% range by 2030. XOM is more efficient at deploying capital, just in time for a breakout. Risk management Josh — Exxon’s fundamentals may be bottoming just at the moment its price is setting sail for a new range. Trading now at about $118, we may not have confirmation of a true breakout until the $125 area — overheard resistance — is tested. But that would be a big trigger for an extended rally after three years of consolidation. For now, traders should hold off until the actual breakout given how many times the stock has hit its head on this level without getting through. But investors can anticipate the breakout and get long in advance. Because if and when this oil tanker starts to move, we may not get another chance. You’ve got a dividend yield and low expectations buffering your potential downside. DISCLOSURES: (None) All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . 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