Is Exxon Mobil Still Attractive After Majnoon Oil Field Talks and Latest Price Moves?

If you have been wondering whether Exxon Mobil is still a buy, hold, or maybe time to trim, you are definitely not alone. Investors have watched this giant energy stock deliver huge returns in the past few years, only to see things get a little more volatile lately. The share price recently closed at $114.26, up 1.3% over the past week and 4.6% in the last month. For 2025 so far, Exxon Mobil is up 6.5%. However, looking back twelve months, shares are actually down 3.0%, even after delivering a massive 314.8% return over five years. That long-term performance has made Exxon Mobil one of the most talked-about players in the energy sector.

Recent price moves have been influenced by some big headlines. There has been talk of Exxon re-entering Iraq’s Majnoon field, which hints at new sources of growth if negotiations go well. At the same time, OPEC+ decisions to modestly boost oil output, plus global restructuring moves like cutting 2,000 jobs, all factor into how the market weighs Exxon’s risk and reward profile right now.

But even with all these moving pieces, what really matters is whether Exxon Mobil is undervalued at current prices. On our scorecard, Exxon Mobil checks 4 out of 6 boxes, giving it a valuation score of 4. That suggests some attractive upside, but also a couple of risks to watch.

So how do those six valuation checks work, and what do they say about where Exxon Mobil is heading next? Let’s break down each approach, and then at the end, we will talk about a smarter way to pull it all together.

Why Exxon Mobil is lagging behind its peers

Approach 1: Exxon Mobil Discounted Cash Flow (DCF) Analysis

A Discounted Cash Flow (DCF) model estimates a company’s intrinsic value by projecting its future cash flows and then discounting those back to today’s dollars. This approach tries to answer the simple question: how much are Exxon Mobil’s future cash flows likely to be worth, right now, in today’s dollars?

For Exxon Mobil, the latest reported Free Cash Flow (FCF) is $32.4 Billion. Analysts have forecast that FCF will grow over the coming years, reaching around $44.6 Billion by 2029. Beyond those analyst estimates, future cash flows are further projected based on moderate sustained growth rates. All figures are calculated in US dollars, making the comparison straightforward.

When all these future cash flows are added up and discounted back, the resulting intrinsic value for Exxon Mobil works out to $258.95 per share. At the recent share price of $114.26, this means Exxon Mobil appears to be trading at a 55.9% discount to its calculated intrinsic value.

This substantial undervaluation implies that, based on current cash flow projections, Exxon Mobil offers considerable upside for patient investors.

Result: UNDERVALUED

Head to the Valuation section of our Company Report for more details on how we arrive at this Fair Value for Exxon Mobil.

Our Discounted Cash Flow (DCF) analysis suggests Exxon Mobil is undervalued by 55.9%. Track this in your watchlist or portfolio, or discover more undervalued stocks.

Approach 2: Exxon Mobil Price vs Earnings

For companies like Exxon Mobil that generate steady profits year after year, the price-to-earnings (PE) ratio is a time-tested way to gauge value. This multiple is especially helpful for profitable firms, as it allows investors to quickly compare how much they are paying for each dollar of earnings relative to both competitors and the broader market.

In simple terms, a "fair" PE ratio will generally reflect the company’s earnings growth potential, its market risks, and how predictable or steady its profits are. If growth is expected to be higher and the risks are lower, a higher PE multiple is typically justified. Conversely, a lower PE ratio may reflect lower growth prospects or higher risks.

Currently, Exxon Mobil is trading at a PE ratio of 15.7x. In comparison, the average PE ratio across its Oil and Gas industry peers sits lower at 13.2x, while the peer group average is noticeably higher at 23.5x. To provide a more nuanced view, Simply Wall St calculates a proprietary "Fair Ratio" for Exxon Mobil of 21.9x. This Fair Ratio reflects not just industry and peer comparisons, but also incorporates the company’s specific earnings growth forecasts, profit margins, risks, and overall market cap for a more rounded valuation estimate.

By using this Fair Ratio rather than just peer or industry averages, we get a tailored benchmark that helps cut through generalizations and better reflect Exxon Mobil’s true circumstances. Since the company’s actual PE ratio of 15.7x is meaningfully below the Fair Ratio of 21.9x, this suggests Exxon Mobil is undervalued based on this key metric.

Result: UNDERVALUED

PE ratios tell one story, but what if the real opportunity lies elsewhere? Discover companies where insiders are betting big on explosive growth.

Upgrade Your Decision Making: Choose your Exxon Mobil Narrative

Earlier we mentioned that there is an even better way to understand valuation, so let’s introduce you to Narratives, a smarter, more dynamic tool for investors on Simply Wall St.

A Narrative is your personalized story of Exxon Mobil, linking why you believe the company is headed a certain way to a set of financial forecasts and ultimately a fair value.

Instead of only looking at historic data or analyst consensus, a Narrative lets you combine your perspective on everything from growth drivers to future margins with your own set of numbers, producing a transparent link between the company’s past, your assumptions about its future, and the fair value you think is right today.

Narratives are available to all investors within the Simply Wall St Community page, making it easy to write your own view, see how it compares to others, and refine your ideas as new information emerges.

This approach helps you make smarter buy, hold or sell decisions, since you can instantly see when your Fair Value is above or below today’s Price. You can also swap between Narratives if yours or the market’s story changes.

Best of all, Narratives update automatically when companies announce earnings or when major news breaks, ensuring your view always stays up to date.

For example, on Exxon Mobil, one Narrative projects a fair value as high as $174 (reflecting bullish views on Guyana’s output and buybacks), while another sees the fair value closer to $124, depending on expectations about oil prices and production risks. This demonstrates how your investment story can directly drive your target price.

Do you think there's more to the story for Exxon Mobil? Create your own Narrative to let the Community know!

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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