Chevron reports record profits in 2022, $75 billion in buybacks as White House fumes

Chevron ( CVX ) posted mixed fourth-quarter results early Friday, missing earnings views while topping earnings estimates. However, the energy giant reported record profits and cash flow in 2022 and already announced it will launch a massive $75 billion share buyback and increase its dividend. Chevron shares fell on Friday.

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Chevron Stock: Earnings

Estimates: Wall Street predicted EPS growth of 69% to $4.33. Analysts saw sales rising 9% to $52.68 billion.

Earnings: Chevron reported earnings rose 60% to $4.09 per share. Revenue grew 17% to $56.47 billion. Full-year 2022 earnings rose 128% to $18.83 per share, while sales rose 51% to $246.25 billion.

Cash flow from operations in 2022 was $49.6 billion, compared to $29.2 billion in 2021. Meanwhile, capital expenditures in 2022 were $12.3 billion, up from $8.6 billion in 2021.

Over the past three quarters, Chevron has averaged 200% year-over-year revenue growth. In Q3, Chevron topped earnings estimates, reporting that EPS rose 88% to $5.56 per share. Sales rose 59% to $66.6 billion in the third quarter.

“We delivered record earnings and cash flow in 2022, while ramping up 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.

At the end of November, the White House eased oil sanctions against Venezuela. The Biden administration, following a human rights deal 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 produce oil for six months and can only export it to the US under the license agreement.

Reuters reported on Wednesday that Chevron’s fifth and sixth cargoes of heavy Venezuelan crude are expected in the United States soon.

Chevron’s buyback program

On Wednesday, Chevron announced its $75 billion share buyback program, representing 20% ​​of outstanding shares, at today’s share price. Chevron also increased its quarterly dividend by 6%, to $1.51 per share. The $75 billion buyback program begins on April 1, 2023, and does not have a fixed expiration date. Chevron’s previous $25 billion share buyback program began in January 2019 and will end on March 31, 2023.

In 2022, the US economy reopened from the Covid pandemic, Russia invaded Ukraine, sending oil and gas prices skyrocketing. This resulted in Chevron, Exxon Mobil (XOM) and other energy stocks lead the market, with the companies posting record profits.

Chevron shares rose more than 50% in 2022 even as the broader stock market fell.

Throughout 2022, President Joe Biden criticized Exxon Mobil, Chevron and several other major producers for choosing to focus on returning money to shareholders rather than spending money on increasing 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 is a strange way to show it,” tweeted the assistant press secretary Abdullah Hasan at the White House on Wednesday. .

Chevron stock

Chevron shares fell 1.8% in premarket trading Friday. On Thursday, the shares rose 4.6% to 187.37. The stock rests on support at its 10-week moving average, below a buy point of 189.78 from a shallow cup base. Aggressive investors can use Monday’s high of 182.55 as an early entry.

The Chevron share ranks 11th in the Oil & Gas-Integrated industry group. CVX stock has a 91 Composite Rating out of 99. The stock has an 84 Relative Strength Rating, an exclusive IBD Stock Checkup gauge of stock price movements. The EPS rating is 78.

Follow Kit Norton on Twitter @KitNorton for more coverage.

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