I will state this again:
Their profit margin is NO HIGHER than your typical company in most industries. They are just in a business that has incredibly high revenue. Also, remember Exxon makes significant profit from lubricants and whatnot as well - not just gasoline.
If you can't beat 'em, join 'em. Nothing wrong with that.Gusin,
Thats a pretty stupid thing to say. Taking pride in making profit off something that hurts everyone else, huh? I'm sure I'll get no love for saying this (and I cant care), but go drown yourself in Exxon gas and take your stock with you.
Exactly. The only reason Exxon is making so much is because they are selling so damn much of the stuff.For FY07 XOM's profit margin was about 10%. Their tax rate for that year was a ridiculously high 42.4%, so Uncle Sam took nearly $30 billion from them in '07.
Selected profit margins from other leading companies for FY'07:
Lockheed Martin, 7.25%
PepsiCo, 14.33%
Apple, 14.56%
Toyota, 6.53%
WalMart, 3.40%
Walt Disney Company, 13.20%
NewsCorp (own's FOX), 11.96%
Yep, and what a lot of people don't realize who are quick to criticize the oil companies (Americans like to point the blame at somebody) is that the crack spread has been tightening for a while, making things difficult for the oil companies. The crack spread is the difference between the price of crude oil and the products extracted from it (i.e. gas). Basically the refining margin.
The people who are quick to bash Exxon should just take a look at it's stock chart. For the past year it's been stuck in a range of $80-$96. It will make a move up and then retrace that move back to where it started. Partly because of the volatility in oil as of late but also because investors don't really think there's much upside at this point for Exxon. If the companies were truly growing income (as a percentage of sales) in lock-step with the increase in the price of crude the chart would look a lot different. There'd be a lot more demand than supply for Exxon stock and it'd sure be well over $110/share right now if that was the case.
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