Exxon is reviewing its global portfolio for divestment opportunities, and will prune assets that don’t fit its strategic priorities, says Woods. The company will also look for tactical opportunities to offload assets at good value, he added.
But it remains unclear when the divestments will give way to share repurchases, and some investors appear to be growing impatient. Exxon saw its stock price slump on Wednesday, despite the company issuing improved guidance for profits and cash flow during its annual investor day.
Analysts say one reason for the pullback is disappointment that Exxon did not launch a buyback program, even as its peers have begun enriching investors by once again repurchasing stock.
“Exxon has been the only supermajor in recent quarters without an active buyback program,” said Raymond James equity analyst Pavel Molchanov.
“Interestingly enough, a decade ago this company had the largest buyback amounts in the entire S&P 500.”
Exxon spent about $210 billion on share buybacks over a decade before halting share repurchases three years ago, except to offset dilution. Now, Exxon has fallen behind its peers like Chevron, Royal Dutch Shell and BP, who have all restarted their share buyback programs following the punishing 2014-2016 oil price downturn.