Latest news with #ChevronCorporationCVX
Yahoo
4 days ago
- Business
- Yahoo
Do Options Traders Know Something About Chevron Stock We Don't?
Investors in Chevron Corporation CVX need to pay close attention to the stock based on moves in the options market lately. That is because the June 20, 2025 $80 Call had some of the highest implied volatility of all equity options today. Implied volatility shows how much movement the market is expecting in the future. Options with high levels of implied volatility suggest that investors in the underlying stocks are expecting a big move in one direction or the other. It could also mean there is an event coming up soon that may cause a big rally or a huge sell-off. However, implied volatility is only one piece of the puzzle when putting together an options trading strategy. Clearly, options traders are pricing in a big move for Chevron shares, but what is the fundamental picture for the company? Currently, Chevron is a Zacks Rank #5 (Sell) in the Oil and Gas - Integrated – International industry that ranks in the Bottom 5% of our Zacks Industry Rank. Over the last 30 days, one analyst has increased the earnings estimates for the current quarter, while two have dropped their estimates. The net effect has taken our Zacks Consensus Estimate for the current quarter from $1.79 per share to $1.58 in that period. Given the way analysts feel about Chevron right now, this huge implied volatility could mean there's a trade developing. Oftentimes, options traders look for options with high levels of implied volatility to sell premium. This is a strategy many seasoned traders use because it captures decay. At expiration, the hope for these traders is that the underlying stock does not move as much as originally expected. Check out the simple yet high-powered approach that Zacks Executive VP Kevin Matras has used to close recent double and triple-digit winners. In addition to impressive profit potential, these trades can actually reduce your risk. Click to see the trades now >> 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 This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
6 days ago
- Business
- Yahoo
Chevron Down 16% in 6 Months - Should You Rethink the Stock?
Chevron Corporation CVX has seen its stock drop roughly 16% over the past six months, falling behind both the S&P 500 and large-cap energy peers like ExxonMobil XOM. For a company known for its scale, dividend reliability and global footprint, this sharp underperformance has left many investors wondering what's gone wrong and whether it's time to re-evaluate the stock's near-term investment appeal. Image Source: Zacks Investment Research In this article, we break down the mounting challenges that explain Chevron's recent slide. From geopolitical setbacks in Venezuela to legal wrangling over its Hess Corporation HES acquisition and earnings underperformance, the energy giant is facing pressure on multiple fronts. Let's examine why the stock's recent decline may not be a buying opportunity, but a warning sign. One major factor behind Chevron's declining fundamentals is the abrupt halt to its Venezuelan operations. Following the expiration of its U.S. license on May 27, 2025, the company is now barred from exporting oil or generating revenue from its joint ventures in the country, operations that previously produced around 150,000 barrels per day of hydrocarbons. At $60 oil, that's a hit worth roughly $3 billion weren't just large volumes of oil — they were low-cost, high-margin barrels that didn't need much reinvestment. Losing them takes away a key source of steady cash flow for Chevron, right when oil prices are shaky and margins are under pressure. Replacing that with more expensive U.S. shale isn't easy, since those wells need ongoing spending just to keep production steady. Chevron's proposed $53 billion acquisition of Hess Corporation (HES) was intended to offset some of that lost volume — but the deal has only deepened investor uncertainty. First, there's dilution: the stock-and-share deal will increase Chevron's share count by up to 20%, putting immediate pressure on earnings per share. That's already a concern in a weak-margin and perhaps more damaging, is the legal dispute now underway. ExxonMobil has challenged the deal, arguing that it has the right of first refusal on Hess's 30% stake in the lucrative Stabroek block offshore Guyana. The outcome, expected in Q3 2025, could determine whether Chevron can move forward with the acquisition at all. A ruling against Chevron would gut the deal's strategic rationale and could lead to an abrupt loss of long-term growth assumptions already priced into the stock. Muted sales growth has also been a driving force behind the poor share performance over recent years. Sales of $47.6 billion in its latest period fell 2.3% year over year, which followed negative growth rates in some of the prior periods of the recent past. Meanwhile, pre-tax profit plunged 30% to $5.6 billion in Q1 due to a 3% rise in total costs. As a result, pre-tax margins narrowed significantly. This is especially concerning as Chevron shifts toward shorter-cycle, reinvestment-heavy shale projects to maintain production. Investors hoping for a rebound won't find comfort in Wall Street's forecast revisions. Chevron's 2025 EPS estimate has fallen from $10.34 to $6.85 over the past 60 days — a 34% drop. Next year's projections are similarly down, from $12.30 to $8.74. That kind of downgrade implies not only lower earnings power but also falling investor conviction in the company's ability to execute. Image Source: Zacks Investment Research These revisions have been reinforced by poor earnings execution. Chevron has missed the Zacks Consensus EPS estimate by an average of 3.6% across the last four quarters. This consistent underperformance has further eroded confidence and helped fuel the stock's downward momentum. Image Source: Zacks Investment Research Despite the growing list of headwinds, Chevron remains expensive relative to its peers. Its forward 12-month P/E multiple stands near 18X, exceeding ExxonMobil's 15.63X. This premium is difficult to justify given the margin pressures, Venezuela loss and unresolved Hess litigation. The company has a Zacks Value Score of D, a sign that the stock offers little in the way of valuation comfort amid deteriorating fundamentals. Image Source: Zacks Investment Research Chevron's dividend yield above 5% is still attractive at face value. However, sustaining meaningful dividend growth may become harder going forward. The reasons are straightforward: the loss of free cash flow from Venezuela, rising reinvestment demands in shale, and the added capital strain from the Hess transaction. With a narrower cash buffer and greater operational complexity, Chevron may have to balance future payouts more cautiously. Chevron stock's decline over the past six months looks more like a signal than a blip. The company faces a complex mix of operational setbacks, legal entanglements, declining margins, and weakening earnings power. What's more, Wall Street has taken note, slashing growth expectations and lowering estimates across the board. The stock's premium valuation only adds to the case for is currently a Zacks Rank #5 (Strong Sell), reflecting negative estimate revisions, soft execution, and an unfavorable outlook within the broader oil/energy industry. For now, it's best to stay away from Chevron stock for now rather than betting on a turnaround that remains far from certain. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 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 Hess Corporation (HES) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
26-05-2025
- Business
- Yahoo
Chevron May Receive Limited Maintenance License for Venezuela
Chevron Corporation CVX is expected to be granted a limited license from the U.S. Treasury Department for limited operations in Venezuela. This special waiver may authorize the oil giant to conduct only critical maintenance and safety-related functions within the sanctions-bound South American country. The license comes as Chevron and other firms in America face looming deadlines to wind down their operations in the region. The decision to restrict Chevron's operations is a marked departure from the broader authorization previously extended under President Biden. That waiver, issued in late 2022, allowed Chevron to not only maintain operations but also produce and sell Venezuela's crude oil, a move designed to re-engage the Nicolás Maduro regime in democratic negotiations. However, this policy was revoked in February by President Trump, citing the failure of Venezuela to commit to democratic reforms and condemning what he referred to as concessions to a dictatorship. The new license, in contrast, is highly restrictive, signaling a return to Trump-era policies that favor isolation and pressure over engagement. The scope of the waiver is expected to resemble Chevron's earlier license that expired in November 2022, strictly prohibiting new investments or crude exports while allowing minimal upkeep to ensure the safety of existing infrastructure. Last week, Secretary of State Marco Rubio confirmed that the current license for Chevron is set to expire on May 27 and the U.S. government will not renew it in the current form. The decision undercuts previous expectations of a 60-day extension, which had been hinted at by Ric Grenell, President Trump's special envoy, following his diplomatic visit to Caracas. The sudden policy shift has cast uncertainty over Chevron's long-term presence in Venezuela, an OPEC nation with the world's largest proven oil reserves. While the exact terms of the new waiver remain undisclosed, sources indicate that only essential operations critical for safety and environmental protection will be permitted. This limits Chevron's activity to basic maintenance, such as preventing spills or leaks and preserving the integrity of facilities. The limited license could serve as a strategic compromise, offering a middle ground that allows the United States to maintain some influence in Venezuela without appearing to support the Maduro regime. This restrained approach may also leave open the possibility for future diplomatic negotiations, though the Trump administration has clearly emphasized a harder line. Importantly, there is no indication yet that other U.S. companies operating in Venezuela will receive similar permissions. For now, the focus remains solely on Chevron, highlighting its unique role as the last remaining major oil producer from America in the country. This policy development coincides with heightened diplomatic activity. On Friday, senator Marco Rubio met with five opposition aides from Venezuela who escaped persecution from the Maduro regime after seeking refuge in Argentina's embassy in Caracas. Rubio reaffirmed U.S. support for the restoration of democratic governance in Venezuela, reinforcing the administration's message that political change remains a top priority. In his public statements, Rubio emphasized the release of political prisoners and reiterated America's unwavering stance against authoritarianism in Latin America. These steps are consistent with the Trump administration's larger campaign to intensify pressure on Nicolás Maduro and disrupt the financial networks supporting his regime. Houston, TX-based integrated oil and gas company's continued presence in Venezuela, even in a limited capacity, reflects the strategic value of its joint ventures with state-run oil company PDVSA, including operations in key fields such as Petroboscan and Petropiar. Though these ventures have been largely dormant due to U.S. sanctions, Chevron has maintained a skeleton crew and infrastructure on the ground to preserve its stakes in anticipation of eventual re-engagement. However, with this latest move, Chevron may now face an extended period of non-operational status, hampered by strict limitations that prevent it from generating revenues or advancing production capabilities. The license is expected to include rigorous compliance and reporting requirements, designed to ensure that no indirect support reaches the Maduro regime. The expected Chevron license reflects a calibrated shift in U.S. policy toward Venezuela, balancing pressure with a narrow path for future diplomacy. This restricts Chevron's operational flexibility, but also keeps it from going out completely, which would give way to rivals from China, Iran and Russia, all of whom are strengthening their energy connections with Caracas. This restricted authorization reasserts American leverage while holding Chevron in strategic limbo, poised between compliance and opportunity in one of the world's most geopolitically complex oil markets. Currently, CVX holds a Zacks Rank #5 (Strong Sell). Investors interested in the energy sector might look at some better-ranked stocks like Subsea 7 SUBCY, which sports a Zacks Rank #1 (Strong Buy), Paramount Resources Ltd. PRMRF and RPC, Inc. RES, each holding a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank stocks here. Subsea 7 is valued at $4.89 billion. The company is a global leader in delivering offshore projects and services for the energy industry, specializing in subsea engineering, construction and installation. Headquartered in Luxembourg, Subsea 7 supports both the oil & gas and renewable energy sectors with integrated solutions, including subsea infrastructure, heavy lifting and life-of-field services. Paramount Resources is valued at $2 billion. It is a Calgary-based energy company engaged in the exploration and development of conventional and unconventional petroleum and natural gas reserves across Canada. Paramount Resources' key assets include significant holdings in the Duvernay, Montney, Muskwa and Besa River formations located in Alberta and northeast British Columbia. RPC is valued at $996.95 million. The company provides a wide range of oilfield services and equipment to support the exploration, production and maintenance of oil and gas wells globally. RPC operates through Technical Services—offering pressure pumping, cementing, and well control—and Support Services, which rents tools and provides pipe handling and inspection. 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 RPC, Inc. (RES) : Free Stock Analysis Report Subsea 7 SA (SUBCY) : Free Stock Analysis Report Paramount Resources Ltd. (PRMRF) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research 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
Yahoo
12-05-2025
- Business
- Yahoo
After Q1 Results, What Comes Next for Chevron Shareholders?
Chevron Corporation CVX released its first-quarter 2025 earnings last Friday, posting results that beat on the bottom line but missed on the top. Adjusted earnings came in at $2.18 per share, slightly above expectations but down 26% from a year ago. Revenues fell 2.3% year over year to $47.6 billion, missing estimates as well. These results were met with a muted reaction, as investors continue to weigh the mixed signals from the oil supermajor's earnings report, valuation and broader macro environment. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.)Currently trading just above $135 — dangerously close to its 52-week low of $132.04 — Chevron's stock has struggled. Over the past three years, shares are down around 15%, sharply underperforming rival ExxonMobil XOM, which has gained 24% in the same period. This stark divergence has left investors questioning Chevron's positioning, especially given the ongoing pressures in the energy market, geopolitical uncertainties and a looming arbitration case over its proposed acquisition of Hess Corporation HES. Image Source: Zacks Investment Research Let's take a closer look at the broader landscape. While Chevron delivered a solid earnings beat, the quality of that beat is up for debate. The strength came largely from higher-than-expected U.S. natural gas production, while oil realizations and margins in the refining segment disappointed. Upstream earnings fell 28.3% year over year, primarily due to weaker oil prices and flat production levels. In the downstream segment, profits slumped nearly 60% due to lower margins. Free cash flow was $1.3 billion, significantly below the prior-year levels, although the company still managed to return $6.9 billion to its shareholders through dividends and has also trimmed its second-quarter buyback target to $2.5-$3 billion, down from $3.9 billion in Q1, a move that reflects the shaky macro landscape and Brent crude's slide toward $60. The lower buyback pace raises questions about the sustainability of Chevron's capital return strategy if commodity prices stay subdued. One reason investors are still paying attention to Chevron is its high-quality asset base. The company continues to benefit from strong operational performance in the Permian Basin, where around 80% of its acreage carries low or no royalty obligations. This improves long-term returns and supports production efficiency. The Tengiz field in Kazakhstan and new deepwater projects like Ballymore in the Gulf of America further strengthen its production the cost side, Chevron's capital discipline is commendable. The company has kept capex tight, spending just $3.9 billion in Q1 while progressing on major projects. It's also pursuing a $2–$3 billion cost reduction initiative through 2026. With a debt-to-capital ratio of around 16.6, Chevron's balance sheet remains one of the healthiest among global oil majors. Image Source: Chevron Corporation Notably, Chevron is still guiding for $10-$20 billion in annual share buybacks, though execution will depend heavily on commodity prices. The company also offers a solid dividend yield of 5%, with 38 consecutive years of dividend growth—a reassuring point for income-focused investors. One major overhang on the stock is the pending $53 billion acquisition of Hess. The prize is Hess's 30% stake in the Stabroek block offshore Guyana, a prolific oil discovery operated by ExxonMobil. However, ExxonMobil and its partner CNOOC have taken Chevron to arbitration, claiming a right of first refusal. The outcome of the arbitration, with hearings set for late May, could determine whether Chevron's biggest growth catalyst materializes or the deal fails, Chevron will miss out on a major addition to its reserves and production. But management maintains that even without Hess, it has the project pipeline and financial strength to deliver growth. Still, the uncertainty adds headline risk that investors must monitor closely. The backdrop isn't particularly supportive for Chevron either. Falling oil prices—due to global trade tensions, potential demand weakness, and OPEC+ developments—have put pressure on upstream earnings. Over the past week, the Zacks Consensus Estimates for Chevron's 2025 and 2026 earnings have both moved downward, signaling waning confidence in the near-term outlook. Image Source: Zacks Investment Research However, valuation does offer some cushion. Chevron trades at an EV/EBITDA multiple of 5.83, which is appealing relative to ExxonMobil and below its five-year historical average. The company also holds a Zacks Value Score of B, suggesting that long-term investors looking for a well-managed energy play may still find value here. Image Source: Zacks Investment Research Chevron's Q1 performance reflects both its strengths and its current challenges. It continues to execute well on cost control and operational efficiency while maintaining a shareholder-friendly capital return program. At the same time, macro headwinds, declining oil prices, the Hess arbitration uncertainty, and slowing buybacks cloud the near-term the company's strong balance sheet, disciplined capital management, and fair valuation, but also its muted growth prospects and legal overhang, CVX stock appears appropriately priced for now. Investors might consider holding existing positions while waiting for greater clarity on oil prices, the Hess deal outcome, and future earnings trends. For these reasons, Chevron stock is currently a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. 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 Hess Corporation (HES) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research 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
Globe and Mail
02-05-2025
- Business
- Globe and Mail
Natural Gas Lifts Chevron Q1 Earnings Amid Oil Weakness
Chevron Corporation CVX reported adjusted first-quarter earnings per share of $2.18, beating the Zacks Consensus Estimate of $2.15. The outperformance stemmed from higher-than-expected U.S. natural gas production in the company's key upstream segment. The unit's domestic output of 2,859 million cubic feet per day (MMcf/d) came in above the consensus mark of 2,666 MMcf/d. A healthy gain in the commodity's U.S. realizations also played its part. However, the bottom line came well below the year-ago adjusted profit of $2.93 due to weaker oil price realizations and a dip in refined product sales margins. The company generated revenues of $47.6 billion. The sales figure missed the Zacks Consensus Estimate of $48.7 billion and decreased 2.3% year over year. Segment Performance Upstream: Chevron's production of crude oil and natural gas — at 3,353 thousand oil-equivalent barrels per day (MBOE/d) (59% liquids) — edged up 0.2% year over year. The latest volume statistics primarily reflect higher output from the Permian basin, Kazakhstan and the Gulf of America, offset by asset sales in Canada and Republic of Congo. The U.S. output rose 4% year over year to 1,636 MBOE/d but the company's international operations (accounting for 51% of the total) dropped 3.2% to 1,717 MBOE/d. With volumes essentially flat from last year and lower oil realizations, Chevron's first-quarter 2025 upstream segment profit fell 28.3% to $3.8 billion. To some extent, this was offset by higher natural gas sales price. At $55.26 per barrel, Chevron's average realized liquids prices in the U.S. were 3.7% below the year-earlier levels, while prices overseas decreased 6.7% to $67.69 per barrel. As far as natural gas is concerned, the commodity more than doubled in the U.S. though it declined 1.8% internationally. Downstream: Chevron's downstream segment recorded a profit of $325 million, plunging 58.5% from last year's income of $783 million. The slip primarily underlined lower product sales margins. (Find the latest earnings estimates and surprises on Zacks Earnings Calendar.) Cash Flows, Capital Expenditure The company recorded $5.2 billion in cash flow from operations, compared to $6.8 billion the year-ago period due to a drop in earnings and tax payments associated with divestment in Canada. Chevron's free cash flow for the quarter was $1.3 billion. Further, Chevron paid $3 billion in dividends and bought back $3.9 billion worth of its shares. The Zacks Rank #3 (Hold) company spent around $3.9 billion in capital and exploratory expenditures during the quarter, compared to the year-ago period's $4.1 billion. You can see the complete list of today's Zacks #1 Rank stocks here. Balance Sheet As of March 31, the only energy component of the Dow Jones Industrial Average had $4.6 billion in cash and cash equivalents and total debt of $29.7 billion with a debt-to-total capitalization of about 16.6%. Important Energy Earnings While we have discussed Chevron's first-quarter results in detail, let's take a look at some other key oil/energy reports of this season. Oil service biggie Halliburton HAL reported first-quarter 2025 adjusted net income per share of 60 cents, the same as the Zacks Consensus Estimate but below the year-ago quarter's profit of 76 cents (adjusted). The numbers reflect softer activity in the North American region, partly offset by international growth. Meanwhile, revenues of $5.4 billion were 6.7% lower year over year but beat the Zacks Consensus Estimate of $5.3 billion. Halliburton reported first-quarter capital expenditure of $302 million, lower than our projection of $318.2 million. As of March 31, 2025, the company had approximately $1.8 billion in cash/cash equivalents and $7.2 billion in long-term debt, representing a debt-to-capitalization ratio of 40.8. HAL bought back $250 million worth of its stock during the January-March period. The company generated $377 million of cash flow from operations in the first quarter, leading to a free cash flow of $124 million. Refining major Valero Energy VLO reported first-quarter 2025 adjusted loss of $1.90 per share, in contrast to the Zacks Consensus Estimate of earnings of 43 cents. The company reported earnings of $3.82 in the year-ago quarter. Total quarterly revenues decreased from $31,759 million in the prior-year quarter to $30,258 million. The top line, however, beat the Zacks Consensus Estimate of $28,450 million. The weak quarterly earnings can primarily be attributed to its West Coast asset impairment, heavy maintenance activity across refining systems and a steep drop in refining margins, which together weighed on profitability. London-based supermajor BP plc BP reported first-quarter 2025 adjusted earnings of 53 cents per American Depositary Share on a replacement-cost basis, excluding non-operating items. The figure lagged the Zacks Consensus Estimate of 56 cents. The bottom line also declined from the year-ago reported figure of 97 cents. The weak quarterly results can be primarily attributed to lower liquid price realizations and weaker refining margins. Lower contributions from the company's customers and products business also affected the results. Organic capital expenditure in the reported quarter totaled $3.4 billion. The company registered a total capital spending of $3.6 billion for the quarter. The first-quarter capital investment totaled $660 million, of which $582 million was allocated toward sustaining the business. 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 BP p.l.c. (BP): Free Stock Analysis Report Chevron Corporation (CVX): Free Stock Analysis Report Halliburton Company (HAL): Free Stock Analysis Report Valero Energy Corporation (VLO): Free Stock Analysis Report
