Top 5 Cyclical Stocks To Buy Now

3. Exxon Mobil Corporation (NYSE:XOM)

Number of Hedge Fund Holders: 68   

Exxon Mobil Corporation (NYSE:XOM) stock is up close to 50% year-to-date on the back of a boost to energy prices and an increase in demand as the post-pandemic recovery gathers pace. There are reports that Exxon Mobil Corporation (NYSE:XOM) plans to increase wages in 2022 by 3.6% across the board, half the rate of inflation, as it also doubles down on investments related to reduction of carbon emissions. The free cash flow and earnings growth of Exxon Mobil Corporation (NYSE:XOM) is heavily discounted as well. 

Hedge funds have been loading up on Exxon Mobil Corporation (NYSE:XOM) stock over the past few months. Latest filings show that 68 hedge funds in the database of Insider Monkey held stakes worth $3.6 billion in Exxon Mobil Corporation (NYSE:XOM), up from 65 in the preceding quarter worth $2.7 billion.

JPMorgan analyst Phil Gresh has an Overweight rating on the shares with a price target of $83. The analyst says the company is “turning a corner, with newfound discipline and good progress on reducing debt from peak levels”. 

In its Q1 2021 investor letter, Harding Loevner highlighted a few stocks and Exxon Mobil Corporation (NYSE:XOM) was one of them. Here is what the fund said:

“We felt that our remaining energy holding, ExxonMobil, with its stronger balance sheet, was in a better position to ride out the cyclical slump in oil demand and even perhaps take advantage of it by investing counter-cyclically. While ExxonMobil does plan to increase capital expenditure, we’ve been disappointed in its regrettable failure to address ongoing emission trends, which reflects poorly on management’s foresight. As a result, we sold our ExxonMobil holdings.”