When a company finds its contractors investigated for “various crimes” in foreign countries, it’s seldom a good sign. And that’s just how investors took the news about oil stock Exxon Mobil (NYSE:XOM), which slipped over 3% at one point in Friday afternoon’s trading.
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So what “various crimes” is Exxon Mobil’s contractors being investigated for? The list is surprisingly robust and about as dark as a barrel of light sweet crude. The contractors in question—a father and son pair of businessmen from Guyana named Nazar and Azruddin Mohamed—may be involved in drug trafficking, gold smuggling, money laundering, and potentially other crimes besides. The duo was contracted back in 2022 to establish a shore base for Exxon Mobil’s offshore work.
However, it’s worth noting that the U.S government explicitly warned Exxon Mobil against doing business with the Mohameds. Though it’s not Exxon that actually did any of this, having people who do engage in such behaviors on the payroll isn’t a good look. It’s sufficiently bad of a look to taint yesterday’s announcement that Exxon Mobil bought Denbury, an oil producer with a lot of low-carbon applications that would likely prove helpful in Exxon Mobil’s pursuit of lower carbon emissions.
This controversy isn’t daunting analysts much, meanwhile. With nine Buy ratings and six Hold, Exxon Mobil is considered a Moderate Buy. Further, Exxon Mobil stock offers investors a 25.62% upside potential thanks to its average price target of $126.89.
