XOM Analysis: ExxonMobil's $621 Billion Energy Empire Rallies 50% Off Its Lows — Why the Dividend Aristocrat's Cash Machine Faces a Margin Squeeze
Exxon Mobil Corporation (NYSE: XOM) has staged one of the most impressive rallies in the energy sector, surging roughly 50% from its May 2025 low of $97.80 to trade at $147.28 as of February 21, 2026. The world's largest publicly traded oil company now commands a market capitalisation of $621 billion, making it the undisputed heavyweight of Western energy. With 43 consecutive years of dividend increases and $52 billion in annual operating cash flow, ExxonMobil remains a cornerstone holding for income-focused investors. Yet the headline numbers mask a more nuanced picture. Fourth-quarter 2025 results revealed meaningful margin compression, with operating income dropping to 7.5% of revenue — roughly half the rate posted in Q1. Full-year net income fell to $28.8 billion from $33.7 billion in 2024, while free cash flow declined to $23.6 billion from $30.7 billion. At 22 times trailing earnings, XOM is no longer the deep-value play it was nine months ago. The question for investors is whether the company's production growth, carbon capture investments, and capital discipline can justify a premium multiple in a normalising energy market.