S&P 500   3,901.36
DOW   31,261.90
QQQ   288.68
S&P 500   3,901.36
DOW   31,261.90
QQQ   288.68
S&P 500   3,901.36
DOW   31,261.90
QQQ   288.68
S&P 500   3,901.36
DOW   31,261.90
QQQ   288.68

Why is Chevron Stock Falling After Strong Earnings?

Saturday, April 30, 2022 | Chris Markoch
Why is Chevron Stock Falling After Strong Earnings?

Long-term investors should continue to watch CVX stock for buying signals 

Chevron (NYSE: CVX) picked a bad day to post strong earnings. Despite a double beat in the company’s first quarter earnings, CVX stock fell over 3%. Concerns over inflation and rising interest rates are overwhelming any good news that corporations can deliver.  

It probably doesn’t help that Chevron is one of the leading companies in the oil and gas sector. These companies profit (literally) when the price of crude oil rises. And when you add in the cries for increased domestic production in the wake of the Russian war on Ukraine, Chevron’s numbers weren’t altogether unexpected.  

Delivering on Expectations 

I was bullish on CVX stock when I was Kate Stalter’s guest on the MarketBeat Podcast. At the time, I wasn’t splitting the atom when I expressed a bullish opinion on Chevron. At the time I pointed out the company’s record free cash flow, a pay down of significant debt, 34 consecutive years of dividend increases and the company saying it may continue to reward shareholders through share buybacks.  

There almost isn’t a more perfect setup than that. But that wasn’t enough for investors on a day when the broader market sold off by over 900 points.  

Doing Its Part 

In the company’s earnings report, Chevron reported it had increased domestic oil and gas production by 10% from the prior year. That includes a record 692,000 barrels in the Permian basin. Furthermore, the company guided that it was planning to reach a production capacity of 700,000 to 750,000 barrels of oil by the end of the year.  

However, Chevron is also taking steps to increase its production of liquefied natural gas (LNG). The Biden administration is asking U.S. companies to help increase the supply of LNG in Europe in response to the Russian sanctions. For its part, Chevron said it was a high priority and was considering new LNG investments in the U.S. Gulf as well as expanding an existing LNG project in Israel. 

An Eye On the Future 

Chevron is putting investing in the company second on its list of priorities after the dividend. And that investment includes areas such as renewable natural gas, renewable diesel and sustainable aviation fuel. These are areas that Chevron believes it has an opportunity to add value. One way the company is attempting to do this is through a partnership with dairy farmers to capture methane emissions. 

And while the company does use both wind and solar energy to power parts of its operation, it is not planning to become a marketer of either energy source. However, the company is planning on making investment in hydrogen and carbon capture.  

Analysts Continue to Upgrade CVX Stock 

In March, MarketBeat contributor Thomas Hughes expressed a bullish opinion on Chevron based on a raft of analysts boosting the company’s stock price. That trend continued in April. And many of these price targets are well above the current price of CVS stock.  

Remember that analysts have access to information that retail investors do not. And they don’t like to look foolish when they make a call. So when analysts are this united in their bullish sentiment, it’s a data point that investors should not ignore.  

Is Chevron a Buy? 

It will be, but not right now. This is a case of not fighting the tape. Chevron has been a favorite of many MarketBeat contributors, me included. And with the combination of rising earnings and revenue, a sustainable dividend, and significant exposure in the renewable energy sector, Chevron is a stock for investors of every stripe.  

Should you invest $1,000 in Chevron right now?

Before you consider Chevron, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Chevron wasn't on the list.

While Chevron currently has a "Buy" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The 5 Stocks Here


Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Chevron (CVX)
2.9755 of 5 stars
Compare These Stocks  Add These Stocks to My Watchlist 


Premium Research Tools

MarketBeat All Access subscribers can access stock screeners, the Idea Engine, data export tools, research reports, and other premium tools.

Discover All Access

Market Data and Calendars

Looking for new stock ideas? Want to see which stocks are moving? View our full suite of financial calendars and market data tables, all for free.

View Market Data

Investing Education and Resources

Receive a free world-class investing education from MarketBeat. Learn about financial terms, types of investments, trading strategies and more.

Financial Terms
Details Here
MarketBeat - Stock Market News and Research Tools logo

MarketBeat empowers individual investors to make better trading decisions by providing real-time financial data and objective market analysis. Whether you’re looking for analyst ratings, corporate buybacks, dividends, earnings, economic reports, financials, insider trades, IPOs, SEC filings or stock splits, MarketBeat has the objective information you need to analyze any stock. Learn more about MarketBeat.

MarketBeat is accredited by the Better Business Bureau MarketBeat is rated as Great on TrustPilot

© American Consumer News, LLC dba MarketBeat® 2010-2022. All rights reserved.
326 E 8th St #105, Sioux Falls, SD 57103 | U.S. Based Support Team at [email protected] | (844) 978-6257
MarketBeat does not provide personalized financial advice and does not issue recommendations or offers to buy stock or sell any security.

Our Accessibility Statement | Terms of Service | Do Not Sell My Information | RSS Feeds

© 2022 Market data provided is at least 10-minutes delayed and hosted by Barchart Solutions. Information is provided 'as-is' and solely for informational purposes, not for trading purposes or advice, and is delayed. To see all exchange delays and terms of use please see disclaimer. Fundamental company data provided by Zacks Investment Research.