The stock market has experienced significant volatility recently, with the Nasdaq Composite entering a bear market after declining more than 20%. Income investors may be wondering if now is the right time to buy dividend stocks given the wild swings in the market. ExxonMobil is a good example of a dividend stock that can be bought with confidence during a bear market.
Mutual funds reshuffled their portfolios in March with big moves across large, mid & small caps 📊 — curious which sectors gained or lost favor? 👀 #READ 👇
Drop your favourite pick in the comments — what did you buy or sell? 💬#MutualFunds #StockMarket #MarchMoves… pic.twitter.com/7RjzgiH87B
— ET NOW (@ETNOWlive) April 15, 2025
The company has raised its dividend consistently, even during challenging times like the oil and gas crash of 2014-2015 and the COVID-19 pandemic. In 2020, ExxonMobil reported its worst year on record with a $22.4 billion loss, but still kept its dividend streak alive. ExxonMobil’s balance sheet is in its best shape in over a decade, with a net total long-term debt position of just $14.7 billion.
The company has improved its cost structure and technological advancements, reducing production costs.
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Even at a pessimistic scenario of $55 per barrel for Brent crude oil, ExxonMobil expects to earn a cash surplus of $110 billion from 2025 to 2030. Thanks to its competitive advantages, the company is well-positioned to endure a prolonged slowdown.
Per this Bloomberg chart, the US bond yield rollercoaster continued today with an 11 basis drop in the 10-year. This was accompanied by 0.6-1.1% gains in the major US stock market indices.
The appreciated return of relative market calm hides a division of views on yields —… pic.twitter.com/3myX8aAeJs— Mohamed A. El-Erian (@elerianm) April 14, 2025
ExxonMobil has a diverse oil and gas production portfolio, a massive refining business, and a growing low-carbon division. This allows it to profit even at lower prices and potentially take market share or make acquisitions during a downturn.
Hedge Funds dumped European Stocks last week at the fastest pace in history 🚨🚨 pic.twitter.com/IPl1D32gn4
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ExxonMobil’s stability in volatile markets
With a yield of 4%, ExxonMobil is an excellent way to generate passive income while staying invested in the market. However, not all dividend-paying companies have the same advantages as ExxonMobil. Some have strained balance sheets or dividends that are already eating up most of their profits, which could lead to dividend cuts if profits stay down for too long.
The stock market sell-off has pushed up dividend yields on many high-quality stocks. PepsiCo and Prologis are two other examples of companies with attractive yields of around 4% and strong financials to support continued dividend growth. During this tumultuous market, investors can find some stability and steady income from stocks with robust dividend yields.
However, it’s important to carefully consider the risks and advantages of each individual company before buying.
