I recently published an article on Seeking Alpha called Exxon Mobil Returning Cash to Shareholders that takes a look at Exxon Mobil’s 10 year history of dividends and share repurchases in order to quantify how much the company has given back to shareholders, and more particularly, to show how the share repurchases have affected EPS growth and dividend growth over the period. It’s currently one of the highest page-view articles on Seeking Alpha for today, mainly because people tend to have pretty strong opinions about share repurchases and like to debate it in the comment section, which is healthy.
It’s interesting seeing a mix of both investors presenting correct statements regarding the downside (or upside) of share repurchases, as well as the investors with a misunderstanding of the topic. Either way, I think it’s a useful article for anyone interested in Exxon Mobil as a company, to get a quantitative look at a long history of dividends and repurchases. As a disclosure, Exxon Mobil is a holding of mine.
Great article, Matt.
It’s humorous and also a bit scary to read the comment section. There is quite a bit of misconception concerning dividends and share repurchases. Seems to me the overall consensus is “buy back less shares” and “pay out more dividends.” Of course, everyone is subject to their own opinion but I’m quite happy since I bought in at $59 a share last year and the stock is now north of $75. I’m sure XOM’s share repurchasing strategies have helped share appreciation considerably. Meanwhile, I’ve been happily collecting a modest dividend and reinvesting it along the way.
Gotta love the comment section on SeekingAlpha, though. I’ve definitely learned a lot over the past few years from reviewing sensible comments and the outlandish ones as well.
I’d like to see the share repurchase/dividend balance shifted a bit in the dividend’s favor, like I mentioned in the article, by boosting yield b 1% or so, but nonetheless XOM is one of the few companies that does share repurchases rather well. Some of the more insightful commentors do have some merit in their opinions, by pointing out that share repurchases can have conflicts of interest. But when share repurchases are done this way, they benefit both management and shareholders.