TTFNF - Reconciling Exxon Stock Price Movements With Earnings Forecast

2024-04-09 10:44:29 ET

Summary

• Exxon Mobil's common stock price recently reached a new high despite the company reporting an impairment charge.
• The impairment charge does not affect reported cash flow but indicates that past income (and sometimes future as well) statements were (or will be) overestimated.
• Investors should prioritize conservative accounting methods and evaluate management's reputation for honesty when reviewing financial statements.
• GAAP accounting allows for a lot of management choices that investors really never know about.  This can provide considerable variability even with GAAP numbers.
• Management achieved the $9 billion cost cutting goal and so has raised that goal to now $15 billion.

For those investors currently invested in Exxon Mobil ( XOM ) the common stock price recently hit a new high. Ironically, there are probably more new highs to come even as the energy giant reports that it will take an impairment charge as it expects lower first quarter earnings....

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