Latest news with #CVX
Globe and Mail
5 days ago
- Business
- Globe and Mail
Chevron Layoffs 2025: Should You Buy, Sell, or Hold the Dividend Stock Amid Its 20% Workforce Reduction?
Chevron's (CVX) decision to cut 20% of its workforce in 2025, recently impacting 800 employees in the Permian Basin region, comes at a tough time for the company. Chevron's stock has lagged behind its peers over the past year The bigger picture isn't much steadier. Oil prices have been unstable, with the EIA expecting Brent crude (CBQ25) to average $74 a barrel in 2025, down from $81 in 2024. At the same time, U.S. crude production is set to hit a record 13.6 million barrels per day this year. Potential supply-demand imbalances and changing trading patterns are weighing on Chevron and its peer energy stocks. Chevron's layoffs and focus on cutting costs show how urgently big oil and gas companies need to adjust as the sector changes. Chevron's dividend yield is still around 5%, but its debt is climbing as it keeps paying dividends and buying back shares even though free cash flow is shrinking. This puts Chevron shareholders at a crossroads: Is now the time to buy, sell, or hold this well-known dividend stock as it reshapes itself for what's next in energy? Let's find out. Chevron's Financial Pulse Amid Layoffs Chevron (CVX) is one of the world's largest energy companies, working across the entire oil and gas process, from finding and producing oil and gas, to refining it into products like gasoline, and selling those products to customers. The recent performance in Chevron's stock shows just how much pressure the company is under. Over the last 52 weeks, shares have dropped 11.1%. So far this year, the decline has continued, with the stock down 3.3%. Looking at the stock's valuation, Chevron trades at a forward price-earnings ratio of 19.95x, much higher than the sector average of 11.85x. This means investors are still willing to pay more for Chevron's size, stability, and future projects. Chevron's latest financial results were mixed. In the first quarter of 2025, earnings fell sharply to $3.5 billion, down 36% from the year before, and revenue dropped to $47.6 billion, which missed what analysts were expecting. Adjusted earnings per share came in at $2.18, just above forecasts, but the numbers were dragged down by legal costs, tax charges, and currency issues. Still, Chevron managed to keep its cash flow strong and returned $6.9 billion to shareholders, showing it remains focused on rewarding investors and managing its money carefully. What's Driving Chevron's Future Growth? Chevron's growth in 2025 isn't just about layoffs and cutting costs. The company recently started producing oil from its Ballymore project in the deepwater Gulf of Mexico, which Chevron now acknowledges as the Gulf of America. Ballymore is expected to add up to 75,000 barrels of oil a day, which will help Chevron move closer to its goal of reaching 300,000 net barrels a day from the Gulf by 2026. Chevron is also looking beyond oil. It has teamed up with Engine No. 1 and GE Vernova (GEV) to supply natural gas power to new U.S. data centers. This project aims to deliver up to 4 gigawatts of reliable energy and is built to be flexible for future carbon capture and renewable upgrades. With the boom in artificial intelligence and digital infrastructure, this partnership could bring in new sources of revenue as demand for data centers grows. For investors who care about steady income, Chevron's dividend stands out. The company has increased its payout for 38 years in a row. The latest quarterly dividend is $1.71 per share, with a yield around 5%, which is higher than the sector average of 4.24%. The payout ratio is just over 71%, which is on the higher side, but it shows Chevron's confidence in its ability to keep paying even in a tough market. Analyst Sentiment and the Road Ahead Analysts are taking a careful approach with Chevron as the company works through job cuts and changes to its strategy. Out of 22 analysts, most rate the stock as a 'Moderate Buy,' with an average price target of $161.59. That's about 15% higher than the current price. Warren Buffett's Berkshire Hathaway (BRK.B) still owns 6.8% of Chevron's shares, which is another strong signal for investors. Still, some analysts are cautious. They point to falling cash flow, growing debt, and concerns about how much more Chevron can get out of its shale operations. Conclusion Chevron's sweeping layoffs and recent stock slump might make investors uneasy, but the company's deepwater projects, bold moves into data center power, and unwavering dividend track record keep it firmly in the game. While the road ahead looks bumpy, analysts see decent upside, and Chevron's fundamentals still point to resilience. For those who already hold shares, patience may yield rewards; for new investors, it's a classic scenario of balancing short-term volatility against long-term prospects.
Globe and Mail
5 days ago
- Business
- Globe and Mail
Is ExxonMobil's Plan for $35 Oil Breakeven Going to be a Game Changer?
Exxon Mobil Corporation XOM mentioned in its recent earnings call that it plans to lower its breakeven costs to $35 per barrel by 2027 and $30 per barrel by 2030. Now, the billion-dollar question lies with the investors: To what extent will this lower breakeven, if achieved, aid XOM? This is a realistic question that should arise in every investor's mind since the integrated energy giant derives the lion's share of its earnings from its upstream business. The no-brainer answer is that this level of low breakeven costs will be highly beneficial for XOM's bottom line, especially from its upstream business. In other words, ExxonMobil will remain profitable even if crude oil prices drop significantly and stand to earn substantially more when prices climb. To add to that, even during most months of 2020, when energy demand collapsed due to the COVID-19 pandemic, ExxonMobil's upstream operations could have been profitable if its breakeven costs had been $30 per barrel. Per data from the U.S. Energy Information Administration, the Cushing, OK, WTI Spot prices for March, April and May were only below the $30 per barrel mark. Thus, there is no doubt that this development, if achieved, is going to be a game changer for ExxonMobil. Other Upstream Firms With Low Breakeven Costs: CVX, EOG According to Statista, a leading platform for data collection and visualization, the breakeven price in the Permian, especially in the Delaware and Midland sub-basins, is well below $40 per barrel. Hence, companies operating in the Permian, like Chevron Corporation CVX and EOG Resources Inc. EOG, are experiencing low breakeven prices. In 2024, CVX conducted 80% of its development activities in the Delaware basin. Chevron plans to increase the development program in the Delaware basin to 85% this year. This simplifies CVX's strong focus on low breakeven-cost operations to maximize its profit. In its recent earnings call, EOG said that it could easily handle all its planned spending for this year, even if oil prices trade in the low $50 per barrel. That means that to remain financially healthy, EOG does not need high oil prices. XOM's Price Performance, Valuation & Estimates Shares of ExxonMobil have declined 4.4% over the past year, outpacing the 6.3% fall of the composite stocks belonging to the industry. From a valuation standpoint, XOM trades at a trailing 12-month enterprise value to EBITDA (EV/EBITDA) of 6.45x. This is above the broader industry average of 4.05X. The Zacks Consensus Estimate for ExxonMobil's 2025 earnings has been revised downward over the past seven days. XOM currently carries a Zacks Rank #4 (Sell). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 5 Stocks Set to Double Each was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%. Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor. Today, See These 5 Potential Home Runs >> Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Chevron Corporation (CVX): Free Stock Analysis Report Exxon Mobil Corporation (XOM): Free Stock Analysis Report EOG Resources, Inc. (EOG): Free Stock Analysis Report This article originally published on Zacks Investment Research (
Yahoo
30-05-2025
- Business
- Yahoo
Chevron Corporation (CVX) Terminates Venezuela Contracts But Will Retain Staff, Says Report
Chevron Corporation (NYSE:CVX) has terminated the contracts it had to operate in Venezuela and has delegated its joint-venture governance to its partner, PDVSA, reported Reuters on Wednesday. However, the company plans on retaining its staff in the country, said sources. A tanker truck making its way through a refinery facility. This follows the revocation of a key license for Chevron Corporation (NYSE:CVX) to operate in Venezuela in March, and this week's expiration of two months granted to the energy company to wind down transactions. However, on Tuesday, the Trump Administration granted Chevron Corporation (NYSE:CVX) a narrow authorization, allowing the oil-maker to retain staff and keep assets in Venezuela, including its joint-venture stakes. These guidelines are similar to the terms it operated between 2020 and 2022, before the Biden government allowed the company to expand in Venezuela and resume crude exports to the U.S. Under the new authorization, the company cannot operate oilfields in the South American country, expand its activities, or export oil to avoid potential earnings for the Maduro government. According to sources, Chevron Corporation (NYSE:CVX) executives met with contractors and Venezuelan government officials this week and communicated about the next steps. While we acknowledge the potential of CVX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CVX and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: ChatGPT Stock Advice: Top 12 Stock Recommendations and 10 Cheap Rising Stocks to Buy Right Now. Disclosure: None. Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
Yahoo
29-05-2025
- Business
- Yahoo
Chevron Corporation (CVX) Terminates Venezuela Contracts But Will Retain Staff, Says Report
Chevron Corporation (NYSE:CVX) has terminated the contracts it had to operate in Venezuela and has delegated its joint-venture governance to its partner, PDVSA, reported Reuters on Wednesday. However, the company plans on retaining its staff in the country, said sources. A tanker truck making its way through a refinery facility. This follows the revocation of a key license for Chevron Corporation (NYSE:CVX) to operate in Venezuela in March, and this week's expiration of two months granted to the energy company to wind down transactions. However, on Tuesday, the Trump Administration granted Chevron Corporation (NYSE:CVX) a narrow authorization, allowing the oil-maker to retain staff and keep assets in Venezuela, including its joint-venture stakes. These guidelines are similar to the terms it operated between 2020 and 2022, before the Biden government allowed the company to expand in Venezuela and resume crude exports to the U.S. Under the new authorization, the company cannot operate oilfields in the South American country, expand its activities, or export oil to avoid potential earnings for the Maduro government. According to sources, Chevron Corporation (NYSE:CVX) executives met with contractors and Venezuelan government officials this week and communicated about the next steps. While we acknowledge the potential of CVX as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than CVX and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: ChatGPT Stock Advice: Top 12 Stock Recommendations and 10 Cheap Rising Stocks to Buy Right Now. Disclosure: None. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
29-05-2025
- Business
- Reuters
Chevron to cut nearly 800 jobs in Texas
HOUSTON, May 28 (Reuters) - Chevron (CVX.N), opens new tab will lay off nearly 800 employees in Texas, according to a notice on Wednesday to the Texas Workforce Commission, part of the U.S. oil producer's plan to cut up to 20% of its global workforce by the end of 2026. The job cuts will be in Midland County, where Chevron has large operations in the Permian Basin, the top U.S. oilfield. The layoff date is July 15, according to the notices. Chevron announced plans to slash the global workforce in February in order to cut costs and simplify the business. Since then, Chevron has come under more pressure, as its license to operate in Venezuela was revoked and its planned $53 billion acquisition of oil producer Hess hangs in the balance amid an arbitration dispute. The company previously gave notice that it would lay off at least 600 employees in California effective June 1, according to a filing in March.
