Exxon Beyond 2011
In a previous article, I explained why long-term investors should consider ExxonMobil (NYS: XOM) for their portfolios. It has a magic globe to see the future? Nah! But, the integrated oil and gas giant does have its growth plans charted out for the next three decades. And it's really good at seeing the future.
The magic globe
Exxon has been smart enough to diversify its holdings across the globe and has been the first mover on various fronts. Consider its acquisition of natural gas producer XTO Energy for $41 billion way back in 2009, or its entry into Argentina's unconventional shale plays.
While there isn't much talk of Exxon's activities in the Chinese shale plays, I suspect this could be the beginning of something big. Don't forget that Asia is extremely critical to Exxon's growth. In simpler terms, the company's ability to predict the future better than its peers sets it apart. If any company comes close to Exxon, it's Chevron (NYS: CVX) . The second-largest integrated oil company's huge natural gas reserves off the Australian coast are a potential game changer.
Do we need to believe?
So why should we bother with what the company has to say, and for a fairly long period of 30 years? Predictions, after all, may not come true. Things can always go wrong at some point. I'd think twice for other companies, but when it comes to Exxon, I'd rather believe it. Take a look at the stock's historical returns.
Exxon's shareholders have seen a fantastic return on their investment in the past 30 years. Without dividends reinvested, the stock has returned 2,323% since 1982. However, if you had reinvested the dividend, your investment would have grown a whopping 5,228%.
Source: S&P Capital IQ.
Is it any surprise then that Exxon has grown to become the world's second-most-valuable company (overtaken by Apple only a couple of months back)? Hardly.
Foolish bottom line
But with a market cap of $403 billion, does Exxon have the ability to grow further? I believe it does. The kinds of projects it has undertaken show management is focusing on the long term, rather than the next few years. In the meantime, we'll bring you the latest news and analysis on ExxonMobil if you add the company to your free watchlist.
If you like energy stocks, we've got a stock idea that could knock your socks off. Read about it right here in The Motley Fool's special free report on the energy industry and its best prospects. It's free for a limited time, so click here today.
At the time this
article was published Fool contributor Isac Simon does not own shares of any of the companies mentioned in this article.Motley Fool newsletter serviceshave recommended buying shares of Chevron and ExxonMobil. The Motley Fool has adisclosure policy.
We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.