Oil and Gas, Mint Finance

Suhas Reddy

Oil and Gas

Deep Fundamental Analysis

Mint Finance

Mint Finance's investment research blends deep fundamental analysis with technical & quant insights. Investment strategies straddle across multiple asset classes with risk management embedded into every trade to deliver an outsized reward-to-risk ratio.

Mint Finance's research is centered around three key themes. First, energy transition and climate change. Second, artificial intelligence. Third, shifting world order with its impact across politics and monetary economics.

Equity Bottom-Up

<ul>
<li>Chevron’s 2024 revenue rose 0.9% YoY, beating estimates by 4.7%, but EPS fell 23.5%, missing estimates by 1.2%. The downstream segment reported its first loss since 2020.</li>
<li>Chevron’s Q4 production fell 1.2% YoY but 2024 output hit a record, with global and U.S. production up 7% and 19% YoY, driven by growth in the Permian.</li>
<li>Chevron raised its quarterly dividend by 5% to USD 1.71/share and reaffirmed plans to generate USD 10 billion in free cash flow over two years.</li>
</ul>


Chevron’s 2024 revenue rose 0.9% YoY, beating estimates by 4.7%, but EPS fell 23.5%, missing estimates by 1.2%. The downstream segment reported its first loss since 2020.
Chevron’s Q4 production fell 1.2% YoY but 2024 output hit a record, with global and U.S. production up 7% and 19% YoY, driven by growth in the Permian.
Chevron raised its quarterly dividend by 5% to USD 1.71/share and reaffirmed plans to generate USD 10 billion in free cash flow over two years.


[Earnings Review] Chevron Missed Expectations Due to Low Margins and High Costs

<ul>
<li>Chevron's Q3 revenue is expected to decline by 7% YoY, with EPS projected to fall 8.9% due to contracting refining margins and lower price realisations.</li>
<li>The early September plunge in oil prices may further squeeze already tight refining margins. Management anticipates a slowdown in output due to increased maintenance in Q3.</li>
<li>Chevron became the most shorted large-cap stock in the US in August, with shares shorted increasing by over USD 200 million amid growing bearish sentiment.</li>
</ul>


Chevron's Q3 revenue is expected to decline by 7% YoY, with EPS projected to fall 8.9% due to contracting refining margins and lower price realisations.
The early September plunge in oil prices may further squeeze already tight refining margins. Management anticipates a slowdown in output due to increased maintenance in Q3.
Chevron became the most shorted large-cap stock in the US in August, with shares shorted increasing by over USD 200 million amid growing bearish sentiment.


[Earnings Preview] Chevron Faces Pressure from Tight Refining Margins and Increased Maintenance

<ul>
<li>Chevron’s Q2 revenue grew 4.7% YoY but its net profit fell by 26.2%. Revenue beat estimates by 1% while EPS missed expectations by 13%.</li>
<li>Production grew 11% YoY, driven by record output in the Permian, strong growth in the DJ Basin, and successful PDC Energy integration.</li>
<li>Q2 capex rose 5.2% YoY to USD 4 billion from higher upstream investments and PDC asset spending. Free cash flow dropped 8% YoY to USD 2.3 billion.</li>
</ul>


Chevron’s Q2 revenue grew 4.7% YoY but its net profit fell by 26.2%. Revenue beat estimates by 1% while EPS missed expectations by 13%.
Production grew 11% YoY, driven by record output in the Permian, strong growth in the DJ Basin, and successful PDC Energy integration.
Q2 capex rose 5.2% YoY to USD 4 billion from higher upstream investments and PDC asset spending. Free cash flow dropped 8% YoY to USD 2.3 billion.


[Earnings Review] Despite Production Growth Chevron’s Profit Falls Due to Lower Refining Margins

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>The latest bear market rally came to a close last week after the S&amp;P 500 and Nasdaq 100 (QQQ) broke below their respective flag supports at 4070 and $304. </li>
<li>Last week we noted a break of these levels would likely mean a trip back to YTD lows and downtrend channel support, which is precisely where we are now.</li>
<li>We remain bearish as long as the downtrends remain intact on the S&amp;P 500, Nasdaq 100 (QQQ), Russell 2000 (IWM), S&amp;P 600 (IJR), and Russell Micro-Caps (IWC)</li>
</ul>


The latest bear market rally came to a close last week after the S&amp;P 500 and Nasdaq 100 (QQQ) broke below their respective flag supports at 4070 and $304. 
Last week we noted a break of these levels would likely mean a trip back to YTD lows and downtrend channel support, which is precisely where we are now.
We remain bearish as long as the downtrends remain intact on the S&amp;P 500, Nasdaq 100 (QQQ), Russell 2000 (IWM), S&amp;P 600 (IJR), and Russell Micro-Caps (IWC)


US Dollar & 10-Year Treasury Yield Breaking Out; Stick With Energy, Also Buying China Education Svcs

Last week we noted that in order for us to turn bullish on the broad market, we need to see breakouts to YTD highs in small-caps (IWM), Financials (XLF), Energy (XOP), and equal-weighted Discretionary (RCD). We now have the breakout we needed in Energy (RYE, XOP), but the other areas are still consolidating. Therefore, we still see a mixed market and we remain neutral yet constructive overall.Stocks highlighted: XOP, WTI Crude Oil, IWD, IWM, S&amp;P 500, Equal-weighted Nasdaq 100 (QQEW), HLT, SEAS, DRI, PLAY, COP, EOG, PXD, OXY, DVN, CLR, CTRA, FANG, MRO, XEC, APA, AR, MUR, RRC, SWN, MTDR, PDCE, SM, BSM, CPE, VNOM, LPI, DMLP, CHX, WHD, NOA, TTI, NR, EXTN, NGS, FET, and CCLP

Last week we noted that in order for us to turn bullish on the broad market, we need to see breakouts to YTD highs in small-caps (IWM), Financials (XLF), Energy (XOP), and equal-weighted Discretionary (RCD). We now have the breakout we needed in Energy (RYE, XOP), but the other areas are still consolidating. Therefore, we still see a mixed market and we remain neutral yet constructive overall.Stocks highlighted: XOP, WTI Crude Oil, IWD, IWM, S&amp;P 500, Equal-weighted Nasdaq 100 (QQEW), HLT, SEAS, DRI, PLAY, COP, EOG, PXD, OXY, DVN, CLR, CTRA, FANG, MRO, XEC, APA, AR, MUR, RRC, SWN, MTDR, PDCE, SM, BSM, CPE, VNOM, LPI, DMLP, CHX, WHD, NOA, TTI, NR, EXTN, NGS, FET, and CCLP

Upgrading Energy To Overweight; WTI Crude Oil and XOP With Major Long-Term Breakouts

United States

PDC Energy, Inc. produces and distributes petroleum products. The Company produces, develops, explores and markets crude oil, natural gas, and natural gas liquids. PDC Energy operates in the United States.

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Pdc Energy Inc (PDCE US)

[Earnings Review] Chevron Missed Expectations Due to Low Margins and High Costs

Chevron's 2024 revenue beats estimates, but EPS falls as downstream segment reports first loss since 2020. Production fell in Q4 but hit record...

Mint Finance

[Earnings Preview] Chevron Faces Pressure from Tight Refining Margins and Increased Maintenance

Chevron’s short-term outlook is gloomy due to weak oil prices and global oil demand amid regulatory complications with its Hess purchase. In Q3,...

Mint Finance

[Earnings Review] Despite Production Growth Chevron’s Profit Falls Due to Lower Refining Margins

Chevron's Q2 revenue up 4.7% YoY, but net profit down 26.2%. Production grew 11% YoY, capex rose 5.2% to USD 4 billion. Free cash flow dropped 8%...

Mint Finance

US Dollar & 10-Year Treasury Yield Breaking Out; Stick With Energy, Also Buying China Education Svcs

US Dollar $DXY & 10-Year Treasury Yield $TNX Breaking Out; Broad Equity Market Not Likely to Bottom Until the USD and Treasury Yields Start Moving...

Vermilion Research

Upgrading Energy To Overweight; WTI Crude Oil and XOP With Major Long-Term Breakouts

Recent developments lead us to believe that Energy is likely to outperform moving forward: WTI crude oil is breaking above $77, and the RYE and XOP...

Vermilion Research

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

[Earnings Review] Chevron Missed Expectations Due to Low Margins and High Costs

​Chevron's 2024 revenue beats estimates, but EPS falls as downstream segment reports first loss since 2020. Production fell in Q4 but hit record...

Mint Finance

[Earnings Preview] Chevron Faces Pressure from Tight Refining Margins and Increased Maintenance

Chevron’s short-term outlook is gloomy due to weak oil prices and global oil demand amid regulatory complications with its Hess purchase. In Q3,...

Mint Finance

[Earnings Review] Despite Production Growth Chevron’s Profit Falls Due to Lower Refining Margins

​Chevron's Q2 revenue up 4.7% YoY, but net profit down 26.2%. Production grew 11% YoY, capex rose 5.2% to USD 4 billion. Free cash flow dropped 8%...

Mint Finance

US Dollar & 10-Year Treasury Yield Breaking Out; Stick With Energy, Also Buying China Education Svcs

US Dollar $DXY & 10-Year Treasury Yield $TNX Breaking Out; Broad Equity Market Not Likely to Bottom Until the USD and Treasury Yields Start Moving...

Vermilion Research

Upgrading Energy To Overweight; WTI Crude Oil and XOP With Major Long-Term Breakouts

Recent developments lead us to believe that Energy is likely to outperform moving forward: WTI crude oil is breaking above $77, and the RYE and XOP...

Vermilion Research

Chevron's 2024 revenue beats estimates, but EPS falls as downstream segment reports first loss since 2020. Production fell in Q4 but hit record...

Chevron's Q2 revenue up 4.7% YoY, but net profit down 26.2%. Production grew 11% YoY, capex rose 5.2% to USD 4 billion. Free cash flow dropped 8%...