Cash key for Chevron and Exxon Mobil as Truist raises stock price target

Chevron Corp. and Exxon Mobil Corp.

“Exxon continues to ‘print money’ to create [more than $17 billion in free cash flow] last quarter,” wrote Truist analyst Neal Dingmann in a note to clients. “The company increased its cash position to $11 billion+ last quarter following its moderate shareholder return program.”

Truist raises its Exxon
+ 0.10%

price target from $111 to $114.

Exxon, like Chevron
+ 0.51%
Impressive 3rd quarter results report last week. Chevron’s result is increase by significant revenue growth in both its U.S. and international upstream operations while Exxon reported highest profit in the company’s 152-year history. (Upstream operations refer to the exploration and production of crude oil and natural gas.)

Watch now: Exxon Mobil shares rose 2.3% after earnings beat past estimates and revenue hit $112 billion.

Truist said that Exxon’s cash gains were particularly impressive. “Latest
FCF of the quarter [free cash flow] Dingmann wrote.

On a separate note, Truist also increased Chevron’s price target to $192 from $188. “Chevron reported higher earnings/FCF than Truist Securities/consensus estimates due to better-than-expected downstream earnings,” Dingmann wrote in Monday’s release notes. (Downstream refers to the refining and distribution of the manufactured product.)

Excluding working capital, Chevron reported free cash flow of $10.7 billion for the quarter, exceeding Truist’s estimate of $10 billion.

Chevron (CVX) is also “keeping things steady,” according to Dingmann. “While CVX has tripled its buyback program in recent quarters and increased its dividend at a compound annual growth rate of 6% over 15 years, the total payout is still significantly lower than many operators. large independence with more or less continuous capital. program,” he wrote.

Watch now: Chevron stock soars to record highs after big earnings break, with $11 billion in net income

However, Chevron continues to develop traditional energy such as its Permian Basin operations in the US and new energies such as renewable natural gas, Dingmann added.

Shares of Chevron rose 1.9% in Monday morning trading while shares of Exxon gained 1.8%, on track to close at a record high.

Of the 29 analysts surveyed by FactSet including Chevron, 15 have an overweight or buy rating, 13 have a hold rating, and one has a sell rating. The average price target has risen to $186.32 from $179.30 in late September, with the latest average target implying a gain of less than 2% from current levels.

Of the 28 analysts surveyed by FactSet, 15 had an overweight or buy rating, 12 had a hold rating, and one had a sell rating for Exxon. The median price target is $113.70, up from $107.41 at the end of September and only about 1% above current levels.

So far, shares of Chevron are up 56.2% and Exxon is up 84.1%, while the S&P 500 index is up 84.1%.

has fallen 18.5% this year.


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