Investing in anything oil-related has required nerve, patience and caution since mid-2014 when crude oil prices went into free fall. Every integrated oil company — even no-brainer blue chips like Exxon Mobil Corporation (NYSE:XOM) — was burned as a result. Though, XOM stock doesn’t look particularly bad.

Exxon Mobil stock is one of the few integrated oil and gas plays outperforming the Dow Jones U.S. Integrated Oil & Gas Index. The index has lost 9.72% over the past three years, while XOM has fallen 7.81% over the same period.

What’s more, competitors including BP plc (ADR) (NYSE:BP) and Royal Dutch Shell plc (ADR) (NYSE:RDS.A, NYSE:RDS.B) have lost at least 25% over the past three years.

But does that mean things are silky smooth for XOM stock? Well, that depends on where you look.

So, we’ll see whether investors should dive into Exxon Mobil by probing three pros and three cons of the company right now.

XOM Stock Pros

Growing Chemical Business: Of all Exxon’s segments, only chemicals has consistently grown earnings between 2013 and 2015. This year, XOM reported earnings growth in chemicals for the first quarter, though segment earnings dropped by $29 million in Q2 because of asset management reasons, which offset stronger margins and higher volume. In Q3, higher maintenance expenses also offset favorable volume and mix effects. But on an overall basis, the chemical segment has continued to grow this year, from a business viewpoint.

Exxon continues to work hard to take advantage of the growth in chemical demand by adding new world-scale chemical facilities. We’ll have to wait until the end of the year to see if XOM’s chems segment can make it a fourth straight year of earnings growth. So keep watch for this when fourth-quarter earnings roll around.

Solid Dividend: XOM stock is a dividend champion and has been for decades, increasing its payout in 40 of the 42 years it has offered a dividend. Its current annualized dividend of $3 per share translates into a yield of 3.4%.

Some have questioned how long Exxon can pay a high dividend given depressed oil prices and suffering cash flows. In first three quarters of the year, XOM stock generated cash flow from operations and asset sales of $5 billion, $5.5 billion and $6.3 billion, respectively. Also, $1 billion of the Q2 and Q3 figures came from asset sales proceeds (only $200 million in Q1). Moreover, the cash flow XOM generates these days is well below what it generated in 2013.

That’s not great, but improved efficiency (more on this below) and management’s resolve to keep shareholders happy keep the dividend as a pro for now, and not a con.

Cutting Expenditures, Improving Efficiency: Exxon stock has an unconventional oil program that’s helping it become more efficient. And with higher oil prices, the more efficient production process will make Exxon Mobil more profitable. For instance, XOM has been enhancing output from its unconventional Bakken and Permian shale plays since the first quarter of 2013, as shown in first chart of the image below.

To Exxon’s credit, the increment in output has been achieved with lower development costs. And the third chart indicates that oil can be produced profitably for nine years if WTI crude oil trades around $40 a barrel.

XOM Stock Cons

Expensive Stock: Exxon trades in the upper $80s, and currently boasts a trailing price-to-earnings ratio of about 40 — well below the industry average of 18. That’s because XOM stock hasn’t really reflected the state of the declining oil market, settling out to just 8% losses over the past three years. I wouldn’t pay too much attention to the forward P/E at the moment, because as long as oil prices remain depressed, there’s an inherent limit to how much XOM can grow its earnings.

Exxon stock also has a lofty price-to-free-cash-flow figure of 553 — crazily higher than its 50x valuation from three years ago. The translation? The market is increasingly overvaluing Exxon’s free cash flow. You could say the problem isn’t with Exxon’s business, but the oil market … but such sky-high valuation calls for a certain degree of caution nonetheless.

Earnings Still Down: Exxon’s earnings have declined from nearly $10 per share four years ago to roughly $2. Yes, Exxon is faring better than the majority of its integrated oil and gas competitors. But declining earnings are almost always a reason for concern — especially when there’s not a ton more that XOM can do to turn this around besides wait for higher oil prices. And Wall Street isn’t reflecting this, as I mentioned earlier.

Mounting Debt: Between 2013 and 2015, Exxon Mobil increased its net debt by $27.9 billion, reporting an increase in net debt each of those years. It’s not the first time XOM would be reporting a net debt increase. But Exxon rarely stacks up consecutive years of net debt increases. In short, Exxon has been taking on more debt to support its business — another reason for caution, especially considering XOM is determined to continue funding its big dividend.

Verdict

Exxon Mobil remains one of the most valuable companies in the world even amidst the oil market turmoil, so it’s still a base stock for just about any portfolio — especially income-oriented portfolios.

However, at current valuations, XOM stock doesn’t appear to promise much value. To me, the stock is still priced as though oil were still at 2014 levels.

My suggestion? Hold it if you’ve got it, but wait for a serious pullback before considering jumping in.

As of this writing, Craig Adeyanju did not hold a position in any of the aforementioned securities.