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The Stock of Chevron Falls as Profits Plunge Amid a Plunge in Natural-gas Prices

April 26, 2024
minute read

Chevron Corp.'s shares, traded under the ticker symbol CVX, experienced a retreat on Friday, setting course for their first decline in eight consecutive sessions. This pullback came after the oil giant unveiled first-quarter financial results showing a decrease in profit and revenue, largely attributed to a significant downturn in natural gas prices, although the company managed to surpass expectations.

On a global scale, production surged by 12.3% to reach 3,346 thousand barrels of oil-equivalent per day (MBOED). This increase was primarily driven by a substantial 34.8% upswing in U.S. production, reaching 1,573 MBOED, which offset a modest 2.2% decline in international production to 1,773 MBOED.

In premarket trading, the CVX stock was down by 0.9%, following a remarkable 5.8% surge during a seven-day winning streak that propelled it to a six-month high by the close of trading on Thursday.

Chevron reported a net income of $5.5 billion, or $2.97 per share, down from $6.57 billion, or $3.46 per share, primarily due to diminished margins on sales of refined products and lower realizations from natural gas sales. Adjusted earnings per share, excluding one-time items, stood at $2.93, surpassing the FactSet consensus of $2.92.

The realization from U.S. natural gas plummeted by 51.9%, while the international realization witnessed a decline of 19.4%.

Despite the decline in revenue by 4.1% to $48.72 billion, the figure managed to exceed the FactSet consensus of $48.42 billion. The company's worldwide production experienced a notable 12% increase, propelled by a 35% surge in the U.S., primarily attributed to the acquisition of PDC Energy and robust performance in the Permian and DJ Basins.

Chevron returned a total of $6 billion to its shareholders, comprising $3 billion through dividends and nearly $3 billion through share repurchases.

Year-to-date, the stock has rallied by 10.8% as of Thursday's close, outperforming the Energy Select Sector SPDR ETF, which rose by 15.3%, and the S&P 500, which gained 5.8%.

Valentyna Semerenko
Eric Ng
John Liu
Editorial Board
Bryan Curtis
Adan Harris
Managing Editor
Cathy Hills
Associate Editor

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