Exxon Mobil’s (NYSE:XOM) lawsuit against activist investor Arjuna Capital was recently dismissed by a U.S. district judge in Texas. The suit targeted a shareholder proposal pushing XOM to cut greenhouse gas emissions. Arjuna had already withdrawn the proposal and agreed not to bring up climate issues at XOM’s future annual meetings.
In this instance, Exxon aimed to prevent shareholders from submitting similar climate-related proposals in the future. It should be noted that if Exxon had won the lawsuit, it would have encouraged other firms to limit shareholder activism on environmental matters.
However, the company’s decision to restrict shareholder proposals faced criticism as investors argued that it could limit their ability to hold public companies accountable for their misconduct.
Hedge Funds Remain Optimistic
Hedge fund managers maintain a positive outlook on Exxon stock due to the company’s strong position in the lucrative Permian basin. Moreover, the company’s capital deployment activities, backed by a strong cash position, help instill confidence in the stock.
Currently, the Hedge Fund signal remains Very Positive for XOM stock. TipRanks data shows that hedge funds bought 13.4 million shares of the company last quarter.
What is the Future Price of XOM?
Overall, the Street has a Moderate Buy consensus rating on ExxonMobil based on 10 Buys and five Holds. The analysts’ average price target on XOM stock of $135.40 implies a 23.79% potential upside from the current level.
