Exxon Mobil shares fall for a second straight session on Monday, oil major to cut capital and operating expenses due to coronavirus pandemic

Exxon Mobil Corp (XOM) plans short-term cuts in capital and operating expenses due to the coronavirus pandemic and has begun informing contractors and vendors, according to a report by Reuters, citing Exxon spokesman Jeremy Eikenberry.

The plans will be announced, when they become final, the representative said.

Exxon Mobil shares closed lower for a second consecutive trading session in New York on Monday. The stock went down 3.94% ($1.29) to $31.45, after touching an intraday low at $30.17, or a price level not seen since July 23rd 2002 ($29.99).

Shares of Exxon Mobil Corporation have retreated 54.93% so far in 2020 compared with a 30.75% loss for the benchmark index, S&P 500 (SPX).

In 2019, Exxon Mobil Corp’s stock went up 2.33%, thus, it again underperformed the S&P 500, which registered a 28.88% gain.

“Based on this unprecedented environment, we are evaluating all appropriate steps to significantly reduce capital and operating expenses in the near term,” Exxon’s Eikenberry was quoted as saying by Reuters.

“We are notifying contractors and vendors of our intended reductions, and they may be adjusting their staffing and budgets accordingly,” the spokesperson added.

Over the past weekend, Exxon cut production at its refinery in Baton Rouge, Louisiana, while last Friday it slashed the number of contract workers by 1,800.

Additionally, the oil major will probably postpone a $30-billion liquefied natural gas project in Mozambique.

Analyst stock price forecast and recommendation

According to CNN Money, the 19 analysts, offering 12-month forecasts regarding Exxon Mobil’s stock price, have a median target of $48.00, with a high estimate of $67.00 and a low estimate of $32.00. The median estimate represents a 52.62% upside compared to the closing price of $31.45 on March 23rd.

The same media also reported that at least 15 out of 23 surveyed investment analysts had rated Exxon Mobil’s stock as “Hold”, while 4 – as “Buy”. On the other hand, other 4 analysts had recommended selling the stock.