Market Cap : 484.31 B | Enterprise Value : 482.24 B | PE Ratio : 9.60 | PB Ratio : 2.60 |
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As of today (2023-01-26), Exxon Mobil's intrinsic value calculated from the Discounted Earnings model is $152.94.
Note: Discounted Earnings model is only suitable for predictable companies (Business Predictability Rank higher than 1-Star). If the company's predictability rank is 1-Star or Not Rated, result may not be accurate due to the low predictability of business and the data will not be stored into our database.
Exxon Mobil's Predictability Rank is 1-Star. Thus, this page is only used for demonstration purposes and the DCF related results in the screener and portfolio will appear as zero.
Margin of Safety (Earnings Based) using Discounted Earnings model for Exxon Mobil is 23.00%.
The historical rank and industry rank for Exxon Mobil's Intrinsic Value: DCF (Earnings Based) or its related term are showing as below:
During the past 13 years, the highest Price-to-Intrinsic-Value-DCF (Earnings Based) Ratio of Exxon Mobil was 2.04. The lowest was 0.24. And the median was 0.77.
The historical data trend for Exxon Mobil's Intrinsic Value: DCF (Earnings Based) can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
This is the intrinsic value calculated from the Discounted Earnings model with default parameters. The calculation method is the same as Discounted Cash Flow model except earnings are used in the calculation instead of free cash flow. This is the default method of calculation with GuruFocus DCF calculator.
Usually a two-stage model is used in calculating the intrinsic value with discounted cash flow model. The first stage is called growth stage; the second is called the terminal stage. In the growth stage the company grows at a faster rate. Because it cannot grow at that rate forever, a lower rate is used for the terminal stage.
GuruFocus DCF calculator is a two-stage model. The default values are defined as:
1. Discount Rate: d = 10%
A reasonable discount rate assumption should be at least the long term average return of the stock market, which can be estimated from risk free rate plus risk premium of stock market. We used the 10-Year Treasury Constant Maturity Rate as the risk free rate and rounded up to the nearest integer, then added a risk premium of 6% to get the estimated discount rate. Some investors use their expected rate of return, which is also reasonable. A typical discount rate can be anywhere between 6% - 20%.
2. Growth Rate in the growth stage: g1 = 5%
Growth Rate in the growth stage = average earnings growth rate in the past 10 years. If it is higher than 20%, we use 20%. If it is less than 5%, we use 5% instead. =>
For companies with Average Earnings Growth Rate in the past 10 years less than 5%, GuruFocus defaults => Growth Rate: 5%
3. Years of Growth Stage: y1 = 10
4. Terminal Growth Rate: g2 = 4%
5. Years of Terminal Growth: y2 = 10
6. EPS without NRI: eps without nri = $12.250.
GuruFocus DCF calculator is actually a Discounted Earnings calculator, EPS without NRI is used as the default. The reason we are doing this is we found that historically stock prices are more correlated with earnings than free cash flow.
All of the default settings can be changed and the results are calculated automatically.
Exxon Mobil's Intrinsic Value: DCF (Earnings Based) for today is calculated as:
Intrinsic Value: DCF (Earnings Based) | = | EPS without NRI | * | {[(1+g1)/(1+d) | + | (1+g1)^2/(1+d)^2 | + | ... | + | (1+g1)^10/(1+d)^10] |
+ | (1+g1)^10/(1+d)^10 | * | [(1+g2)/(1+d) | + | (1+g2)^2/(1+d)^2 | + | ... | + | (1+g2)^10/(1+d)^10]} |
set x = (1+g1)/(1+d) = (1+0.05)/(1+0.1) = 0.95454545454545
and y = (1+g2)/(1+d) = (1+0.04)/(1+0.1) = 0.94545454545455
Intrinsic Value: DCF (Earnings Based) | = | EPS without NRI | * | {[x | + | x^2 | + | ... | + | x^10] | + | x^10 | * | [y | + | y^2 | + | ... | + | y^10]} |
= | EPS without NRI | * | [x | * | (1-x^10) | / | (1-x) | + | x^10 | * | y | * | (1-y^10) | / | (1-y)] | |||||
= | 12.250 | * | 12.485 | |||||||||||||||||
= | 152.94 |
Margin of Safety % (DCF Earnings Based) | = | (Intrinsic Value: DCF (Earnings Based) | - | Current Price) | / | Intrinsic Value: DCF (Earnings Based) |
= | (152.94 | - | 117.76) | / | 152.94 | |
= | 23.00 % |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Unlike valuation methods such as Net Current Asset Value, Tangible Book Value per Share, Graham Number, Median Ratio etc, discounted Cash Flow model evaluates the companies based on their future earnings power instead of their assets.
What you need to know about Discounted Earnings model:
1. The Discounted Earnings model evaluates a company based on its future earnings powerYou can screen for stocks that trade below their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) with the GuruFocus All-in-One Screener. Companies with a high Predictability Rank that trade at a discount to their Intrinsic Value: DCF (FCF Based) and Intrinsic Value: DCF (Earnings Based) can be found in the screen of Undervalued Predictable Companies.
Thank you for viewing the detailed overview of Exxon Mobil's Intrinsic Value: DCF (Earnings Based) provided by GuruFocus.com. Please click on the following links to see related term pages.
Talley Darrin L | officer: Vice President | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION IRVING TX 75039-2298 |
Ubben Jeffrey W | director | 1170 GORGAS AVENUE SAN FRANCISCO CA 94129 |
Mikells Kathryn A | officer: Senior Vice President | 77 W. WACKER DRIVE CHICAGO IL 60601 |
Karsner Alexander | director | C/O APPLIED MATERIALS, INC. 3050 BOWERS AVENUE, P.O. BOX 58039 SANTA CLARA CA 95052-8039 |
Goff Gregory James | director | 19100 RIDGEWOOD PARKWAY SAN ANTONIO TX 78259 |
Hietala Kaisa | director | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION 5959 LAS COLINAS BOULEVARD TX 75039-2298 |
Gibbs Jon M. | officer: Executive Officer | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION IRVING TX 75039-2298 |
Fox Leonard M. | officer: Vice President and Controller | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION IRVING TX 75039-2298 |
Angelakis Michael J | director | 40 MORRIS AVENUE BRYN MAWR PA 19010 |
Zulkiflee Wan | director | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION IRVING TX 75039-2298 |
Morford Craig S | officer: Vice President & Gen. Counsel | CARDINAL HEALTH, INC. 7000 CARDINAL PLACE DUBLIN OH 43017 |
Carr Ian S | officer: Vice President | 5959 LAS COLINAS BOULEVARD C/O EXXON MOBIL CORPORATION IRVING TX 75039-2298 |
Littleton Stephen A | officer: Vice President and Secretary | 5959 LAS COLINAS BOULEVARD IRVING TX 75039-2298 |
Hooley Joseph L | director | STATE STREET CORPORATION ONE LINCOLN STREET BOSTON MA 02111 |
Mckee Karen T | officer: Vice President | 5959 LAS COLINAS BOULEVARD IRVING TX 75039-2298 |
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