For sure Exxon Mobil (NYSE: XOM) is no hyped-up AI enterprise but don’t confuse boring with broken.
This year alone, Exxon has surprised any investor thinking the oil giant was just hanging onto the past while the world moves to clean energy.
The next five years are as much about lithium, carbon capture, and a strategy that looks like it was ripped straight out of a private equity playbook as it was historically about oil barrels and gas stations.
So yeah, this isn’t the Exxon story you’ve been hearing.
A Big Bet on Lithium
Earlier this year Exxon began drilling lithium wells in Arkansas of all places. Management said it’s aiming to produce enough lithium by 2030 to power a million EVs a year. However, they’re not building a mine in the traditional sense as much as they are using direct lithium extraction, a cleaner and more efficient method that could make old-school hard-rock mining look a little prehistoric.
Lithium is a lifeblood material for automakers. Ford and GM have both warned that lithium supply may very well be the choke point for EV production. So when Exxon with all its scale decides to muscle into this space, that’s worth paying attention to.
This move alone tells you Exxon is planting a flag in the future of energy.
The Carbon Capture Pivot
Where things get really interesting is that Exxon’s leadership announced a $2 billion of further investment to its carbon capture and storage project in Louisiana. The CEO said CCS might well become a “standalone business” with “multi-billion-dollar annual revenues” by 2030.
Exxon’s already signed deals with major industrial firms to capture emissions at their sites. And moreover, it’s charging them to take that carbon off their hands. It’s a revenue stream that didn’t even exist five years ago.
This is Exxon leaning into regulation. So, instead of fighting emissions policies, it’s building a business around them. That flips the old narrative on its head.
What About Oil?
Alright, let’s talk oil because it’s still the cash cow.
Brent crude is holding above $80 per barrel as of mid-2025 and that’s plenty high for Exxon to keep generating strong free cash flow. In fact, analysts at Citi estimated in May that Exxon would finish 2025 with over $45 billion in free cash flow if oil prices stay near current levels.
And it’s not just pulling that cash out of the ground but putting it to work. In the past year, Exxon completed its $60 billion acquisition of Pioneer Natural Resources. That deal makes Exxon the undisputed heavyweight in the Permian Basin, with enough shale reserves to stay on top of U.S. oil production for years.
Now combine that with the lithium push and the CCS pipeline and you’ve got a company that’s using fossil fuel cash flows to fund future-proof businesses, a rather ingenious move.
Dividend Faithfuls Still Have Lots To Like
We can’t overlook Exxon’s cult-like dividend following either. The Board chose to raise the dividend again in Q1 2025, marking 43 straight years of dividend hikes. Some people frame that as predictable. But in this market predictability is gold.
Yield watchers are still collecting over 3% annually from Exxon right now. And while other companies are scaling back capital returns, Exxon’s buyback program is alive and well. Management said they’re on track to repurchase $20 billion in stock this year alone.
This isn’t a company hoarding cash. It’s handing it back with both hands.
Institutional Confidence Is Climbing
In February, Vanguard increased its stake in Exxon by nearly 5%. Not a small move. And it wasn’t alone. State Street, BlackRock, and Fidelity all reported heavier Exxon positions in their Q1 13F filings.
What does that tell us? Big money is betting on execution, optionality, and a management team that’s proven it can shift when it matters most.
Analysts Are Warming Up Too
Now for the Wall Street view. In April, JPMorgan raised its Exxon price target to $145, citing “structural earnings upside” from CCS and lithium. Goldman Sachs followed with a $150 target, calling Exxon “a platform business in the making.”
For context, Exxon is trading in the low $110s as of June 2025. So these targets are baking in about 30% upside, not counting dividends. For a company this size, that’s a big endorsement.
Even more interesting? Bank of America added Exxon to its “Top Picks” list for energy in 2025, ranking it ahead of Chevron and Shell.
That’s not nothing.
Where Will Exxon Be in 5 Years?
Exxon stock is likely to hit $123 per share in 5 years according to the consensus among 26 analysts, with a high price target of $140 per share.
Exxon’s lithium ambitions won’t just be a side hustle. By 2030, it is aiming to be a top-five lithium producer in the U.S. If that happens, it’ll be supplying raw materials for EVs while its legacy oil business funds the buildout.
The carbon capture segment is already landing revenue-generating contracts. Exxon expects the business to scale fast, and it’s got first-mover advantage in one of the only parts of the energy world where government regulation actually helps profits.
Meanwhile, oil isn’t going away. Exxon just grabbed the crown in the Permian. That basin is still the most productive oil field in the U.S., and Exxon now owns the best acreage.
Add in the dividends, the buybacks, and the fact that it’s essentially using its oil cash machine to build the lithium and CCS pillars of tomorrow, and you’ve got something rare in a legacy energy company actually thinking like a growth stock.
The Takeaway Is Bullish
By 2030, Exxon’s stock is likely to reflect a trio of cash engines, including legacy oil, lithium, and carbon capture, alongside regulatory tailwinds and a massive footprint.
Assuming Exxon trades at a forward multiple similar to today’s 11x earnings, and earnings expand even modestly from new revenue streams, a $160–$180 stock price is realistic, and beyond what even the most bullish analysts are forecasting. Toss in five more years of dividend growth and buybacks, and long-term investors are looking at a strong total return.
And surprising as it may seem, Exxon might end up being one of the most compelling clean energy plays of the decade.
The author has no position in any of the stocks mentioned. Financhill has a disclosure policy. This post may contain affiliate links or links from our sponsors.