Is Exxon’s Stock a Buy Despite Lower Earnings?

Exxon Mobil Corporation (NYSE:XOM) released third-quarter earnings on November 1, 2012 and although the numbers were down a bit year over year, the company managed to beat analyst expectations for the current quarter. Earnings-per-share estimates called for $1.96 a share and the company reported $2.09. Revenues of $115.7 billion beat estimates of $115.08 billion.  With global economies in turmoil and the price of oil declining, the 1.9 percent year-over-year drop in EPS and 7.7 percent decline in revenue came as no surprise.

Couple that news with the mad dash to the exit doors following the presidential election and you have the ingredients for a downturn. XOM dropped 4.6 percent through the close of trading on Friday November 16.

Is it time to BUY Exxon on this dip? Exxon generates more revenue than any other company on the planet, and its market capitalization now runs second only to Apple (NASDAQ:AAPL). Is it time to WAIT and SEE what happens to global demand and the price of crude oil?  Or is it time to simply STAY AWAY and look for companies with better growth opportunities?

Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework: