If you want to own a dividend producing company, one of the best companies to own over the past 100 years is Exxon, previously called Standard Oil. The founders including John Rockefeller who consolidated the oil industry at the turn of last century and made billions of dollars. From those early beginings to the present the oil industry at least Standard Oil has been very profitable. It turns of dividends – it has paid billions of dollars to its shareholders and it is hard to imagine that it will not continue to do so for the next 50 years plus. In a book called Private Empire – ExxonMobil and American Power, Steve Coll, the Penguin Press, 2012, Mr. Coll takes a look at Exxon and how it operates. The company does not make profits just because oil prices are high, it is a very disciplined company which prides itself and expects a superior record of project execution, budget management, and use of cutting-edge technology. Much of the oil industry is very capital intensive projects – Exxon expects to bring its projects under budget and on time. Those that like working for Exxon like and expect the culture of discipline and accountability. From an investor point of view – those attributes of the Exxon culture are music to the ears. However, as Exxon has interests around the world, sometimes those attributes do not necessarily include great listening skills. An internal part of Exxon is rate of return on capital – how much each project increased the shareholder capital. Similar to all oil companies, Exxon concern was to increase the corporation’s oil reserves and that lead to its buying of Mobil. Exxon had concentrated on western countries, Mobil was more international. As the dominant oil company in the world, how Exxon has managed is the story of the book.

Linking to dividend producing stocks, if you wish to own a consistent dividend producing company, ExxonMobil should be one of the companies you own or on your list to acquire. You may or may not understand how Exxon operates its relationship to other governments, but as a dividend producing it continues to do very well.

There are more questions than answers, till the next time – to raising questions