Exxon stock is rising after getting upgraded at Credit Suisse.
Dreamstime
Exxon Mobil stock is jumping after Credit Suisse upgraded its shares from Neutral to Outperform on Tuesday.
Unlike many of its competitors, Exxon Mobil (XOM) bet that the world will continue to run on fossil fuels over the medium term and that’s a bet that will pay off, writes Credit Suisse analyst Manav Gupta. Unlike its Big Oil peers, many of whom forecast that the energy transition would lower demand for oil and gas, Exxon has continued to invest in the production of both commodities, Gupta noted.
Exxon Mobil’s explorations in Guyana, South America, in particular, is “one of the best growth stories” and production in the Permian Basin, Texas, “continues to beat expectations,” writes Gupta.
Exxon Mobil has also continued to invest in its refinery in Beaumont, Texas, and Gupta estimates that this refinery will generate a combined $10 billion in free cash flow in 2022 and 2023.
Credit Suisse isn’t the only bank bullish on Exxon stock recently—its shares were also upgraded by Evercore ISI’s Stephen Richardson earlier this month.
Exxon stock has gained 6.3% Tuesday, while the S&P 500 has risen 1.9% and the Dow Jones industrial average has advanced 1.9%. Exxon shares are up 50% in 2022.
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