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Warning:  long post ahead!


In the tables below you will find my analysis of the
petrochemical giants Exxon and Mobil.  Since I bought
into both of these stocks in my pre-Foolish days, I 
decided to apply the Rule Maker criteria to them to
see just how smart I was.  Granted, the oil business
is a much more capital-intensive and cyclical business
than most of the current Rule Makers, so this whole 
exercise may be like comparing apples to oranges.  In 
any event, here's what I got:

Table #1:  EXXON 

Financial AnalysiCompany Being Evaluated                          Competitor #1   Competitor #2  Competitor #3

                   EXXON (XON)                                        Mobil         BP Amoco       Shell Oil
                 Current Period Year-ago PeriodYear-over-Year    Current Period  Current Period Current Period
                  98Q4 (12/98)   97Q4 (12/97)      Growth         98Q4 (12/98)     98Q3 (9/98)   98Q4 (12/98)
Income Statement . . .
  Sales                  29,139         35,062     -16.9%                 13,182          7,457         15,451
  Cost of Goods S        10,557         14,514     -27.3%                  8,458          3,451         10,723
  Net Income              1,460          2,500     -41.6%                   (152)           295         (1,727)
  Shares Outstand         2,428          2,457      -1.2%

Balance Sheet . . .
  Cash & Equivale         1,461          4,047     -63.9%                    714            657            322
  Current Assets         17,593         21,192     -17.0%                  8,731          5,311          4,048
  Short-term Debt         4,248          2,902      46.4%                  3,982            973          5,301
  Current Liabili        19,412         19,654      -1.2%                 12,946          5,213          8,838
  Long-term Debt          4,530          7,050     -35.7%                  3,719          5,257            490
                                                                                1              1              1
Margins & Ratios . . .                                                                                         Competitors' Average
  Gross Margins            63.8%          58.6%      5.2                    35.8%          53.7%          30.6%     40.1%
  Net Margins               5.0%           7.1%     -2.1                    -1.2%           4.0%         -11.2%     -2.8%
  Cash-to-Debt              0.17           0.41    -59.1%                    0.09           0.11           0.06      0.09
  Net Cash               -7317.0        -5905.0      N/A                  -6987.0        -5573.0        -5469.0   -6009.7
  Fool Flow Ratio           1.06           1.02     3.9%                     0.89           1.10           1.05      1.02


                  Continue Here

Ranking Rule Makers

1) Brand          Points (0-1)                                  3) Financial Dire Points (0-3)
Familiarity                    1                                Sales Growth                   0
Openness                       1                                Gross Margins                  3
Optimism                       1                                Net Margins                    1
Legitimacy                     1                                Shares Outstandin              3
Inevitability                  1                                Cash-to-Debt                   0
Solitariness                   0                                Fool Flow Ratio                0
Humor                          0                                Expansion Potenti              2
  Subtotal                     5                                  Subtotal                     9

2) Financial Loca Points (0-2)                                  4) Monopoly Statu Points (0-4)
Mass Market Habit              2                                Gross Margins                  4
Gross Margins                  2                                Net Margins                    4
Net Margins                    0                                Net Cash                       4
Cash-to-Debt                   0                                Fool Flow Ratio                0
Fool Flow Ratio                1                                Convenience                    2
Your Interest                  1                                  Subtotal                    14
  Subtotal                     6
                                                                5) Your  Enjoymen              1

                   Total Score               35  Third Tier


Table #2:  MOBIL

Financial AnalysiCompany Being Evaluated                          Competitor #1   Competitor #2  Competitor #3

                   MOBIL (MOB)                                        Exxon         BP Amoco       Shell Oil
                 Current Period Year-ago PeriodYear-over-Year    Current Period  Current Period Current Period
                  98Q4 (12/98)   97Q4 (12/97)      Growth         98Q4 (12/98)     98Q3 (9/98)   98Q4 (12/98)
Income Statement . . .
  Sales                  13,182         16,574     -20.5%                 29,139          7,457         15,451
  Cost of Goods S         8,458         10,276     -17.7%                 10,557          3,451         10,723
  Net Income               (152)           704       N/A                   1,460            295         (1,727)
  Shares Outstand           781            783      -0.3%

Balance Sheet . . .
  Cash & Equivale           714            820     -12.9%                  1,461            657            322
  Current Assets          8,731          9,722     -10.2%                 17,593          5,311          4,048
  Short-term Debt         3,982          2,994      33.0%                  4,248            973          5,301
  Current Liabili        12,946         12,421      4.2%                  19,412          5,213          8,838
  Long-term Debt          3,719          3,670      1.3%                   4,530          5,257            490
                                                                                1              1              1
Margins & Ratios . . .                                                                                         Competitors' Average
  Gross Margins            35.8%          38.0%     -2.2                    63.8%          53.7%          30.6%     49.4%
  Net Margins              -1.2%           4.2%     -5.4                     5.0%           4.0%         -11.2%     -0.7%
  Cash-to-Debt              0.09           0.12    -24.7%                    0.17           0.11           0.06      0.12
  Net Cash               -6987.0        -5844.0      N/A                  -7317.0        -5573.0        -5469.0   -6119.7
  Fool Flow Ratio           0.89           0.94     -5.3%                    1.06           1.10           1.05      1.07


                  Continue Here

Ranking Rule Makers

1) Brand          Points (0-1)                                  3) Financial Dire Points (0-3)
Familiarity                    1                                Sales Growth                   0
Openness                       1                                Gross Margins                  1
Optimism                       1                                Net Margins                    0
Legitimacy                     1                                Shares Outstandin              3
Inevitability                  1                                Cash-to-Debt                   0
Solitariness                   0                                Fool Flow Ratio                2
Humor                          0                                Expansion Potenti              2
  Subtotal                     5                                  Subtotal                     8

2) Financial Loca Points (0-2)                                  4) Monopoly Statu Points (0-4)
Mass Market Habit              2                                Gross Margins                  0
Gross Margins                  0                                Net Margins                    0
Net Margins                    0                                Net Cash                       0
Cash-to-Debt                   0                                Fool Flow Ratio                2
Fool Flow Ratio                2                                Convenience                    2
Your Interest                  1                                  Subtotal                     4
  Subtotal                     5
                                                                5) Your  Enjoymen              1

                   Total Score               23  Fourth Tier



As you can see, neither one of these companies matches
up especially well to the Rule Maker criteria.  A 
certain amount of blame can be placed on the glut of
oil that has been present in the market for the past
year thanks to our friends at OPEC.  Since they have
now decided to tighten the spigots a bit, then the
profitability should start returning to both Exxon and
Mobil.  It will be interesting to see what happens to
the numbers over the next several quarters as the 
price of oil climbs upward and the proposed Exxon 
Mobil merger goes through.

As always, post any questions and comments.

Fool On!

the LanceMan



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