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Exxon Profit Perspective

April 28, 2006

A colleague of mine recently e-mailed me about Exxon's profits:

There are over 6 billion shares of Exxon stock, so its earnings were only $1.37 per share...on a $61 stock! The Exxon earnings are actually a disappointment. The only reason the number is so huge is that the company is huge after all the mergers (many many many stockholders). Why not run a headline saying that Exxon's annual return is ALMOST 9%? How about a headline saying Exxon's dividend yield is JUST OVER 2%? Think about it — is $8 billion divided among 6 billion shares & shareholders really outrageous? Would you pay $61 for an investment that earned $1.37 last quarter?

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