Are Analysts Positive on Chevron following Its Q1 Results?



Analysts’ ratings for Chevron

Chevron (CVX) posted its first-quarter earnings results on April 26, 2019. Its earnings fell but surpassed Wall Street analysts’ consensus estimate. Now let’s evaluate how analysts see Chevron after its first-quarter earnings release.

Chevron has been rated by a total of 19 Wall Street analysts. Of this total, 14 (or 74%) have given it “buy” or “strong buy” ratings, five (or 26%) have given it “hold” ratings, and none have given it “sell” ratings. Chevron’s mean target price stands at $141, which implies a potential upside of 20% from its current level.

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Why are analysts positive on Chevron after its first-quarter earnings?

In the first quarter, Chevron continued to improve its financials and return wealth to shareholders. The company paid $2.2 billion in dividends and repaid $1.6 billion worth of debt. During the company’s first-quarter earnings conference call, CEO Mike Wirth stated, “During our Security Analyst Meeting, we shared that our advantaged portfolio, strong balance sheet and low breakeven, capital discipline and lower execution risk position us well to deliver superior shareholder returns.”

Chevron’s total capital and exploratory spending stood at $4.7 billion in the first quarter of 2019. Most of Chevron’s capex went toward its promising Upstream segment. Its Upstream volumes increased 7% YoY to 3.04 MMboepd (million barrels of oil equivalent per day) in the first quarter of 2019.

Recently, Chevron agreed to acquire Anadarko Petroleum in a cash and equity deal. The deal is expected to boost Chevron’s Upstream volumes. Anadarko’s first-quarter Upstream volumes stood at 0.7 MMboepd. For more on the acquisition, read A Surprise Megadeal: Chevron to Acquire Anadarko.

It’s no surprise that given Chevron’s strengthening financials and expanding Upstream portfolio, most analysts hold favorable opinions on its stock.

Peers’ analyst ratings

BP (BP), ExxonMobil (XOM), and Royal Dutch Shell (RDS.A) have been tagged as “buys” by 54%, 27%, and 82% of analysts, respectively. Total (TOT), Suncor Energy (SU), and Petrobras (PBR) have been evaluated as “buys” by 100%, 92%, and 70% of analysts, respectively.


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