It's all about the dividend!

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Exxon Mobil (XOM): A Top Dividend Stock According to Hedge Funds
*Published April 14, 2025

Dividend Importance & Market Context

From 1960 to 2024, a $10,000 investment in the market grew to $982K on stock price alone
With reinvested dividends, the same investment would have reached approx. $6.42M
Dividends are now a key component of investor strategy, especially in uncertain economic environments
S&P companies now account for 85% of total dividends in the market (up from 82% in 2024)
Top 29 dividend-paying S&P companies contribute 40% of S&P index dividends, 35% of all U.S. equity market dividends
Under current forecasts, those firms could distribute $280B in dividends in 2025 (or up to $288B in a bullish case)

Why Dividends Matter

Dividend stocks offer income & long-term value
Nuveen & Simply Safe Dividends highlight benefits like lower volatility & strong fundamentals
Dividend growth firms tend to outperform the broader market over time

Exxon Mobil (NYSE:XOM) Key Stats

Number of hedge fund holders: 104
Q4 2024 revenue: $83.4B (down 1.1% YoY)
Return on capital employed: 12.7% in 2024; 5-year avg: 10.8%
Cost savings: $12.1B since 2019
2024 operating cash flow: $55B (3rd strongest in last decade)
Q4 cash flow: $12.2B (operating), $8B (free cash flow)
Capital returned to shareholders in 2024: $36B, including $16.7B in dividends
Dividend streak: 143 consecutive years of payouts
Consecutive dividend growth: 42 years
Current dividend: $0.99/share quarterly
Dividend yield: 3.84% (as of April 12, 2025)

Overall Ranking & Outlook

Ranks 6th among best dividend-paying stocks held by hedge funds
While XOM remains strong, the report suggests other dividend stocks may offer higher short-term return potential
A separate report highlights a deeply undervalued dividend stock trading at 10x earnings with double-digit earnings growth

Disclosure: None. Originally published by Insider Monkey.
https://www.insidermonkey.com/blog/exxon-mobil-corporation-xom-among-the-best-dividend-paying-stocks-according-to-hedge-funds-1507465/

Comment! It's anonymous!

3 replies (most recent on top)

Dividends are definitely a major part of the value story, especially in a volatile market where income and capital discipline matter more than ever. While ROCE isn't at peak levels, a 12.7% return in a capital-intensive industry is still solid—especially when paired with $55B in operating cash flow and a 42-year streak of dividend growth.

As for the comparison to savings accounts, short-term yields look appealing now, but they won’t last. Dividends, especially from a firm like XOM, offer long-term compounding and inflation protection that cash simply can’t match.

That said, totally agree—execution matters. Let’s hope the capital is allocated wisely going forward, not just to defend the dividend but to create value long-term.

I get a better return on cash in a savings account.

Also, that ROCE now is woeful. I can remember when EM did multiples of that... Which isn't necessarily a good thing, but over paying for late poor yielding projects isn't winning either Mr. Woods.

You still got your 19% raise though, so it's all good.

it says, a deeply undervalued stock

ok, let's buy some.

Thread regarding ExxonMobil Corp. layoffs

It's all about the dividend!

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