On the one hand, the 3.2% gain in ExxonMobil's (XOM 0.24%) stock price in April doesn't seem like a big deal. However, with the S&P 500 plunging 8.8% last month, according to data provided by S&P Global Market Intelligence, it was a standout performer.
Fueling the oil stock's relative outperformance was a combination of analyst upgrades, earnings, and more positive news from Guyana.
In early April, Exxon made a final investment decision for the Yellowtail development, its fourth and largest offshore oil project in Guyana. The company expects this $10 billion project to start producing 250,000 barrels of oil per day in 2025. The company announced three new oil discoveries in offshore Guyana a few weeks later. As a result, it now has 11 billion barrels of oil equivalent recoverable resources to support current and future projects.
Meanwhile, Exxon is also making investments to reduce the energy industry's carbon emissions. It started design studies for a carbon capture hub in Australia last month. That added to a growing number of projects it's working on to achieve net-zero emissions by 2050.
Analysts also contributed to Exxon's rise last month. RBC Capital analyst Biraj Borkhataria upgraded Exxon's stock from sector perform to outperform while raising the stock's price target from $90 to $100 a share. Truist analyst Neal Dingmann also increased his firm's price target on ExxonMobil's stock, boosting it from $75 to $84 per share.
Finally, Exxon capped April off by reporting its first-quarter results. While the oil giant's adjusted earnings of $2.07 per share came in slightly below the analysts' consensus estimate of $2.12 per share, the company generated strong free cash flow of $10.48 billion. Further, Exxon sees results improving in the second quarter as some of the issues that impacted its first-quarter numbers will fade away. These factors gave Exxon the confidence to triple its share repurchase program to $30 billion through 2023.
The continued strength of the oil market helped fuel Exxon's stock last month. The company is generating lots of cash flow, giving it the funds to invest in new oil projects and lower-carbon opportunities while returning an increasing amount of money to shareholders. Exxon expects these strong market conditions to continue for the foreseeable future, which could give its stock the fuel to continue outpacing the market.