* If you are wondering whether Exxon Mobil is still a smart buy at today's levels, you are not alone. The stock's recent run has value focused investors asking if there is more upside or if the easy gains are behind it.
* Exxon Mobil has quietly climbed to about $119.22, delivering roughly 1.5% over the last week, 2.8% over the past month, 11.1% year to date, 16.2% over 1 year, and 250.6% over 5 years. This return profile suggests both resilience and rising expectations.
* Those moves have been underpinned by a steady drumbeat of headlines around major upstream projects, multibillion dollar investments in low carbon initiatives, and ongoing capital return programs via dividends and buybacks. Together, these have helped reshape how the market is pricing Exxon's future cash flows, risk profile, and long term growth story.
* On our valuation framework, Exxon Mobil currently scores 4/6 checks for being undervalued. This is a solid but not flawless value signal that begs a closer look at what the models might be missing. Next, we will walk through the standard valuation approaches that drive that 4/6 score and then finish with a way to think about Exxon's worth beyond the usual multiples and DCFs.
Exxon Mobil delivered 16.2% returns over the last year. See how this stacks up to the rest of the Oil and Gas industry.
Approach 1: Exxon Mobil Discounted Cash Flow (DCF) Analysis
A Discounted Cash Flow model estimates what a company is worth by projecting its future cash flows and then discounting them back to today, using a required rate of return. For Exxon Mobil, the model starts with last twelve months free cash flow of about $28.1 billion and builds in analyst forecasts for the next few years, then extrapolates longer term projections.
Based on this 2 Stage Free Cash Flow to Equity model, Exxon Mobil's free cash flow is expected to rise to roughly $52.3 billion by 2035. Simply Wall St uses analyst estimates through 2029, then tapers growth to more modest levels beyond that horizon to avoid unrealistically high long term assumptions.
When all those projected cash flows are discounted back to today, the DCF model arrives at an intrinsic value of about $246.65 per share. Compared with the current share price around $119, the DCF implies the stock is roughly 51.7% undervalued, which indicates a wide margin of safety if the cash flow trajectory matches these expectations.
Result: UNDERVALUED
Our Discounted Cash Flow (DCF) analysis suggests Exxon Mobil is undervalued by 51.7%. Track this in your watchlist or portfolio, or discover 905 more undervalued stocks based on cash flows.