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Exxon Mobil Corp (NYSE: XOM) has gained about 5.0% over the past three weeks but a Mizuho analyst says it’s time to stop buying this energy stock.

Exxon stock lost its buy rating at Mizuho

Nitin Kumar downgraded the oil and gas behemoth this morning to “neutral” and lowered his price target to $117.

The analyst turned dovish on Exxon stock primarily because he expects oil prices “to be range bound in 2024” until international travel trends and global demand gets clearer.

Mizuho’s call arrives just days before Exxon Mobil Corp is scheduled to report its financial results for the first quarter. Consensus is for it to earn $2.07 a share versus $3.4 per share a year ago.

$XOM is currently down nearly 15% versus its 52-week high.

Kumar expects estimates to be revised down

Nitin Kumar is convinced that the global economy will slow down this year which will weigh on oil demand. His research note reads:

Although OPEC+ continues to be supportive of the oil markets by constraining supply, fears of slower demand recovery and resilient non-OPEC supply have been a headwind in our view.

He expects the Wall Street to eventually revise its estimates down for earnings and cash flow of Exxon Mobil Corp. The Mizuho analyst also downgraded Occidental Petroleum today to “neutral”.

Interestingly, though, the firm remains bullish on Chevron Corp that it, in fact, sees as a “top pick” in the energy space for the current year.

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