Chevron posted mixed fourth-quarter results early Friday, missing on earnings views while topping revenue estimates. The energy giant reported record profits and cash flow for 2022, on top of its earlier announcement launching a massive $75 billion share buyback and raising its dividend. Chevron stock edged lower Friday.
Chevron Stock: Earnings
Estimates: Wall Street predicted EPS growing 69% to $4.33. Analysts targeted a 9% sales increase, to $52.68 billion.
Earnings: Chevron reported a 60% earnings jump, to $4.09 per share. Revenue grew 17% to $56.47 billion. Full-year earnings in 2022 ballooned 128% to $18.83 per share while sales increased 51% to $246.25 billion.
Cash flow from operations in 2022 totaled $49.6 billion, compared with $29.2 billion in 2021. Meanwhile, capital spending in 2022 was $12.3 billion, up from $8.6 billion in 2021.
Over the last three quarters, Chevron has averaged 200% earnings growth compared to the previous year. In Q3, Chevron topped earnings estimates, reporting EPS surging 88% to $5.56 per share. Sales increased 59% to $66.6 billion in the third quarter.
"We delivered record earnings and cash flow in 2022, while increasing investments and growing U.S. production to a company record," CEO Mike Wirth said in a statement Friday.
"We are well positioned to lead in both traditional and new energy businesses, while delivering higher returns, lower carbon and superior shareholder value," Wirth added.
In late November the White House eased oil sanctions on Venezuela. The Biden administration, following a human rights agreement signed between President Nicolaus Maduro's administration and opposition negotiators, said it would allow Chevron to resume oil production in the Latin American nation. Chevron can only export it to the U.S. under the six-month license agreement.
Reuters reported Wednesday that Chevron's fifth and sixth cargo of heavy Venezuela crude are expected in the U.S. soon.
Chevron's Buyback Program
On Wednesday, Chevron announced its $75 billion stock buyback program, which represents 20% of shares outstanding at current price levels. Chevron also boosted its quarterly dividend by 6%, to $1.51 a share. The $75 billion buyback program will begin on April 1, 2023, and does not have a fixed expiration date. Chevron's previous stock buyback program of $25 billion began on Jan. 2019 and will end on March 31, 2023.
In 2022, as the U.S economy recovered from the Covid pandemic, Russia invaded Ukraine in February, sending oil, gasoline and natural gas prices soaring. This resulted in Chevron, Exxon Mobil and other energy stocks leading the market, with the companies posting record profits.
Chevron stock rose more than 50% in 2022 even as the broader stock market declined.
Throughout 2022, President Joe Biden criticized Exxon Mobil, Chevron and several other large producers for choosing to focus on returning money to shareholders instead of spending to increase production.
"For a company that claimed not too long ago that it was 'working hard' to increase oil production, handing out $75 billion to executives and wealthy shareholders sure is an odd way to show it," White House Assistant Press Secretary Abdullah Hasan tweeted Wednesday.
Chevron Stock
Chevron stock fell 4.4% to 179.52 in market trade Friday. On Thursday, shares rose 4.6% to 187.37. That lifted shares above support at its 10-week moving average. CVX shares are hovering around a 189.78 buy point from a shallow cup base. Aggressive investors could have used Monday's high of 182.55 as an early entry.
Chevron stock ranks 11th in the Oil & Gas-Integrated industry group. CVX shares have an 91 Composite Rating out of 99. The stock has an 84 Relative Strength Rating, an exclusive IBD Stock Checkup gauge for share-price movement. The EPS rating is 78.
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