October 27, 2016 Read More →

ExxonMobil: Three Key Indicators of Weakness

Matt Egan for CNN Money:

Exxon, which reports quarterly results on Friday, will rebound, right? It is after all an industry titan, with vast resources and a loyal following of investors who live off its generous dividends.

Tom Sanzillo, former deputy comptroller of New York State, doesn’t think so. Sanzillo says Exxon’s finances suggest the company may be in the middle of an “irreversible decline.”

“There are more red flags than a 10-car pileup at a NASCAR race,” said Sanzillo, who is now director of finance at the Institute for Energy Economics and Financial Analysis, an environmentally-focused research group. Cleveland-based IEEFA is funded in part by a philanthropy run by the Rockefeller family, which built its wealth on oil but recently divorced itself from fossil fuel investments.

Here are three red flags that Sanzillo highlighted in a new report, released Wednesday:

  • Annual revenue down 45% over the past five years
  • Long-term debt has quadrupled to nearly $30 billion
  • It’s had to borrow money to pay out dividends and buy back shares

Full article: Warning: ExxonMobil may be in irreversible decline

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