Sun, Feb 20, 2005 - Page 10 News List

US goliaths trade places

BIG OIL With market capitalization of US$383 billion, Exxon Mobil has knocked General Electric off the top spot as the US' largest corporation by stock market value


Buoyed by rising profits from lofty oil prices, Exxon Mobil Corp passed General Electric Co on Friday to become the largest US corporation by stock market value.

The two goliaths traded places after Exxon Mobil shares gained more than 2 percent -- having surged 43 percent from a year ago -- while GE's stock slipped.

That vaulted Exxon Mobil ahead of GE in market capitalization, topping US$383 billion compared with about US$379 billion for GE.

A spokesman for Exxon Mobil, which just set a record for quarterly operating profits by a US corporation, said the Irving, Texas-based company wasn't counting.

"We kinda leave that to other folks," said Tom Cirigliano. "Our goal is to be the most efficient and profitable company. If the outcome of that is that we become the largest company, that's just icing on the cake."

Exxon Mobil was already far ahead of GE in sales and profits.

David Frail, a spokesman for GE, a conglomerate with industrial, financial and media holdings including the NBC television network, said the company preferred to focus on returning to double-digit growth in earnings.

"We're focusing on growing our earnings and growing our market cap, in that order," Frail said. "We're not as concerned with rankings as we are with growing the businesses we've got."

Mark Baxter, director of an energy institute at Southern Methodist University in Dallas, said the long run-up in Exxon Mobil stock reflected investor confidence in the company's management and a desire to cash in on rising oil and gas prices.

"It came their way, but you still have to manage the company," Baxter said. "They've always done that well."

Baxter said that for Exxon Mobil, the honor of being No. 1 carried risks. He said the company wished to avoid the limelight because of the public's negative perception of big oil.

In trading on Friday afternoon on the New York Stock Exchange, Exxon Mobil shares rose US$1.28, to close at US$59.41, while GE shares fell US$0.15, to US$35.88. That was enough of a swing to put Exxon Mobil ahead in market capitalization -- price multiplied by the number of outstanding shares. GE shares have gained 9 percent in the past year.

Last month, Exxon Mobil announced it earned US$25.3 billion last year, believed to be a record for US companies after excluding windfalls from selling assets. Revenues were US$298 billion, topping the previous leader, Wal-Mart Stores Inc, at US$288 billion.

Profits at Fairfield, Connecticut-based GE have grown more slowly in the last few years, hitting US$16.6 billion on sales of US$152 billion last year.

The two Goliaths maintained a comfortable lead in stock market value over the next three largest US companies by market cap, Microsoft Corp, Citigroup Inc and Wal-Mart.

Exxon Mobil gave another indication on Friday that it could stay among the leaders for a long time. It reported that for the 11th straight year it added enough new energy reserves to fully replace all the oil and natural gas it produced last year.

The company has proved reserves of 22.2 billion barrels, enough oil and gas to last 14 years at current production rates.

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