Exxon Since 2020: Guyana, the Permian and a Cheaper Barrel

Exxon’s Guyana operation pumped 918,000 barrels a day in February 2026, and by the fourth quarter, if the newest production vessel behaves, that number should cross a million. The stock, meanwhile, sits within 6.1% of its 52-week high at $163.54, near 21.0 times trailing earnings versus a five-year average closer to 10.1. Two numbers pulling in different directions, and only one of them is really about oil in the ground.

I go back to 2020 because I think the years since explain this stock better than any single quarter does. Oil traded below zero for a day that April. Exxon had loaded up on debt and big capital projects at close to the worst point in the cycle, it dropped out of the Dow Jones Industrial Average that August, and a small activist fund called Engine No. 1, owning a sliver of the company, won three board seats the following year by arguing management had misjudged both the energy transition and its own spending discipline. That fight is the hinge this whole story turns on.

My thesis: Exxon swapped its old boom-and-bust playbook for a smaller, steadier one built around a hard capital ceiling and a short list of low-cost projects, and the market is now paying a premium multiple for that steadiness rather than for barrels. Whether the barrels can still justify today’s price is the harder question.

A board fight still shapes every capital decision

Whatever you think of Engine No. 1’s reasoning, the 2021 vote sent a message the board and the big index funds behind it were not going to ignore twice. Management responded by publishing capital ceilings tied to specific oil-price scenarios, something it had never done in public before, and it has stayed close to those numbers through two very different years since. The dividend, raised every year for more than four decades running, gave the company cover during the worst stretch of 2020. Dividends alone did not rebuild the credibility, though. The spending discipline did.

That is the part people forget. A boardroom fight from 2021 is still visible in a capex line five years later.

The spending ceiling that survived three oil cycles

Net income for fiscal 2025 came to $29.8 billion, roughly 15% below the $35.1 billion Exxon posted a year earlier, while revenue slipped -5% to $323.9 billion. Net margin held at 9%, in a year nobody would call generous for crude prices. A spending ceiling only gets tested when the top line goes soft, and fiscal 2025 is closer to that test than any year since 2020.

The longer comparison matters more than the year-over-year one. Revenue has fallen from the 2022 peak of $398.7 billion, when the war in Ukraine pushed every energy major’s numbers up, to today’s $323.9 billion, a decline of about 19%. Operating income of $33.9 billion against that backdrop, for an operating margin of 10%, tells me the discipline is doing real work rather than just surviving on a high oil price. I read that as the clearest evidence the post-2021 strategy is more than a talking point.

Guyana is closing in on a million barrels a day

Guyana’s Stabroek block, where Exxon operates with a 45% stake alongside partners CNOOC and the stake Chevron picked up from Hess, produced an average of 918,000 barrels a day in February 2026, according to the company’s own release, up from nothing a decade ago. The fifth floating production vessel for the project, tied to the Uaru development, arrived on site in August and is targeted to add close to 250,000 barrels a day of capacity by the fourth quarter, which would push total output above a million barrels a day by year-end. Once every phase is approved, the company’s stated plan calls for total Stabroek capacity of 1.7 million barrels a day across eight separate developments. That growth curve is the engine behind most of the numbers in this piece, more than the refining business or the low-carbon unit combined.

I compared five energy names on one set of numbers not long ago, and Exxon was the steadiest of the group rather than the cheapest. Guyana is a big part of why that steadiness holds up.

The Permian deal was about inventory, not size

Exxon agreed in October 2023 to buy Pioneer Natural Resources for $59.5 billion in an all-stock deal, its largest acquisition since it bought Mobil in 1999, and the transaction closed in the first half of 2024. What the price actually bought was inventory: a large, contiguous position in the Permian’s Midland Basin that lets Exxon keep drilling for years without needing to buy more land. I think that is the real logic behind the deal, more than the production figures management likes to cite on earnings calls, because a company that has to keep re-stocking its drilling inventory every few years is a structurally different, riskier business than one that already owns it outright.

Losing the Hess arbitration cost less than it looked

Exxon and CNOOC argued they held a right of first refusal over Hess’s 30% stake in Stabroek and tried to use it to block Chevron’s purchase of Hess. An arbitration panel under the International Chamber of Commerce disagreed, and Chevron closed its $53 billion Hess acquisition on July 18, 2025. Exxon’s public response was terse: it disagreed with the panel but would respect the process.

I read that terseness as closer to relief than defeat. Exxon still operates Stabroek. It still holds 45% of it. A well-funded new partner in Chevron does not change the operating math nearly as much as owning the missing 30% itself would have, and the block’s output kept climbing right through the ruling. Losing the legal fight mattered less to the stock than the headlines at the time suggested.

It also settled a question that had hung over the stock for two years: whether a prolonged legal fight would slow the pace of new vessels arriving at Stabroek. It did not. The Uaru vessel showed up on schedule anyway, which tells me operationally the two companies have learned to coexist even where they disagree on paper.

Twenty-one times earnings for a company selling barrels

Here is the number that has been bothering me. Exxon trades at 21.0 times trailing earnings versus a five-year average closer to 10.1. The forward multiple looks more reasonable at 13.5, but that number assumes forward earnings per share of $12.14, a 56% jump from the trailing $7.77. I am not convinced that jump happens without either a higher oil price than the futures strip currently prices in, or the new Guyana barrels arriving on the guided schedule. That is the specific uncertainty I would flag before anyone buys the stock on the forward number alone.

Running a reverse discounted cash flow on a rich multiple is a useful exercise for growth names, but the mirror version applies here too: work out what oil price and production path a 21 multiple demands from a company that just posted a revenue decline, and decide whether Guyana alone can supply it by year-end.

Dividend coverage got tighter, not looser

The dividend runs $4.08 a year, a 2.49% yield at today’s price, against trailing earnings per share of $7.77. That works out to a payout ratio a little above half, roughly 52%, up from the low-40s percent range Exxon ran during the strong 2022 and 2023 years. None of this threatens the payout by itself. But a payout ratio climbing while net income falls is worth tracking rather than ignoring, and I would treat 60% as the level where I start asking harder questions about the raise Exxon typically announces every October.

On dividend growth versus a high current yield, Exxon sits closer to the growth camp. The 2.49% yield is modest next to some peers. The streak of annual increases, now past four decades, is the longer and arguably better argument.

Sixteen analysts cover the stock now. Half rate it a buy, and the average target of $170 implies only 4% of upside from here, with the low estimate of $155 actually sitting below today’s price.

Metric	Value	Context
Price	$163.54	52-week range $107-$174, 6.1% below high
P/E (TTM)	21.0	five-year average 10.1
Forward P/E	13.5	assumes EPS of $12.14, up 56%
Dividend	$4.08 (2.49%)	payout near 52% of trailing EPS
Revenue (FY2025)	$323.9 billion	down -5% from $339.2 billion in 2024
Net income (FY2025)	$29.8 billion	down from $35.1 billion a year earlier
Analyst target	$170 avg (16 analysts, 50% buy)	4% upside; range $155-$185

What the fourth quarter needs to show

If Guyana’s new capacity comes online close to the guided 250,000 barrels a day and margins hold where they are, the multiple I am calling rich today will look cheap within a year. That is the specific way I would be wrong about this. If it slips into 2027, or if the next earnings report shows net margin falling below the current 9%, the premium gets harder to justify. My own threshold is the fourth-quarter production update: a print near or above a million barrels a day out of Guyana settles the argument in Exxon’s favor, at least for a while. Short of that, I would rather buy the dip than the multiple.

Analysis and opinion only, not investment advice. Figures come from ExxonMobil’s second-quarter 2026 results and its filings on SEC EDGAR; Guyana production and deal figures are sourced in the text above and were checked on September 23, 2026.