Exxon Mobil Corporation (XOM) & More Plays For This Type of Investor

Despite Exxon Mobil Corporation (NYSE:XOM)’s performance, both Zacks and Barrons rank the stock as a hold. Several reasons generate discomfort among analysts and investors. Similar to Apache Corporation (NYSE:APA)’s, the $333.795 billion last declared in assets represent a threat to Exxon’s stability, as the asset growth rate of 14.6% doubles the company’s five year average annual revenue growth of 7%. The same can be said about operating and gross margins, both considerably declining over the past few years, in addition to the 5.2% (YoY) decline in its production level reported for last quarter.

Conclusion

In spite of the fact that Exxon Mobil Corporation (NYSE:XOM) trades at low multiples while still offering some upside, its financials and recent results are quite discouraging. Same is the case for Apache. Pioneer Natural Resources (NYSE:PXD)’s situation is also sticky: it presents plenty of growth and upside opportunities, but trades at 73.6x P/E, 14 times the U.S. Oil and Gas E&P industry median.

Although Pioneer Natural Resources (NYSE:PXD) could still be a buy, notwithstanding its price due to the highly positive earnings outlook it provided, my general recommendation regarding these companies would be to hold.

The article 3 Great Picks for the Energy Investor originally appeared on Fool.com and is written by Victor Selva.

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