Chevron Stock Falls as Q4 Profits Fail Expectations in a Record Year.

Chevron Stock

Chevron Stock (NYSE:CVX)

Chevron (NYSE:CVX) was trading down 1.2% in pre-market trading on Friday after the company reported that it did not meet analysts’ estimates for its adjusted profitability in the fourth quarter, even though its sales were above analysts’ projections.

The net income for the fourth quarter increased to $6.35 billion, or $3.33 per share, from $5.05 billion, or $2.63 per share, in the same period a year ago. Still, it decreased from $11.2 billion in the third quarter because $1.1 billion in writedowns in international oil and gas operations caused adjusted earnings to fall short of projections.

Chevron stock said its annual profits came to a total of $35.5 billion, its highest-ever annual profit. This figure is more than twice what it reported for the previous year and roughly a third more than what it reported for its previous record in 2011.

Additionally, the corporation established new benchmarks in 2022 for annual cash flow from operations of $49.6 billion and free cash flow of $37.6 billion.

Revenues for the fourth quarter increased by 17% year over year to a total of $56.47B, which was higher than the average estimate of Wall Street. The year’s revenues reached $246.3B, an increase over the previous year’s total of $162.5B.

Chevron (NYSE:CVX) reported that its fourth-quarter earnings in its upstream business decreased by 11.9% to $2.62 billion, primarily due to the absence of Q4 2021 asset sale gains. In contrast, the company reported that its fourth-quarter earnings from its international business increased by 31.2% to $2.87 billion, citing higher realizations.

The fourth quarter’s net production decreased by 3% year over year to 3.01M boe/day, with U.S. production increasing by 4%, principally in the Permian Basin. Still, overseas production is falling by 7%, mostly due to the expiration of concessions in Thailand and Indonesia.

After adjusting for lower prices and portfolio changes – primarily the sale of Eagle Ford assets and the expiration of a contract in Thailand – the company expects production to grow, led by the Permian and other shale and tight assets. For the fiscal year 2023, Chevron (NYSE:CVX) sees production coming in flat to up 3% at $80 Brent; the company sees production coming in flat to up 3% at $80 Brent.

Chevron stock has risen by 8% this year and 41% in the previous 12 months.

Featured Image: Pexels @ Wendy Wei

Please See Disclaimer

About the author: I'm a financial journalist with more than 3 years of experience. I have worked for different financial companies and covered stocks listed on ASX, NYSE, NASDAQ, etc. I have a degree in marketing from Bahria University Islamabad Campus (BUIC), Pakistan.