Chevron Misses Q2 Expectations Due To 'Weaker Upstream, Downstream Results' But Permian Production Hits New Record

Shares of Chevron Corp CVX tanked in early trading on Monday, as the company reported downbeat second-quarter results just days after unveiling plans to relocate its headquarters.

The results came amid an exciting earnings season. Here are some key analyst takeaways.

• RBC Capital Markets analyst Biraj Borkhataria maintained an Outperform rating, while reducing the price target from $190 to $180.
• Truist Securities analyst Neal Dingmann reiterated a Hold rating, while lowering the price target from $156 to $154.
• Goldman Sachs Aanalyst Neil Mehta reaffirmed a Buy rating and price target of $177.

Check out other analyst stock ratings.

RBC Capital Markets: Chevron reported an earnings miss due to "weaker upstream and downstream results," Borkhataria said. "Operationally, CVX continues to perform well with Permian production hitting a(nother) new record, and full-year guidance raised," while further de-risks the 1mboed 2025 target, he added.

Arbitration delays are proving to be "a significant distraction to what is otherwise a clear investment case," the analyst stated. He added, however, that the weakness in the stock is "pricing in a more negative scenario already."

Truist Securities: Chevron reported its earnings and free cash flows below consensus due to weak commodity prices and downstream earnings, Dingmann said. Stabroek JOA (Joint Operating Agreement) has set a hearing for 2025, further delaying the closure of the Hess acquisition, he added.

"In additional to Permian production likely hitting 1+ mmboepd next year, CVX could see solid GOM production upside by 2026 all the while reducing unit drilling costs," the analyst wrote. The company may keep its quarterly dividend at $1.63 per share, while reaching its share buyback target of $17.5 billion this year, he further stated.

Goldman Sachs: Chevron reported adjusted earnings of $2.55 per share, missing its own guidance of $2.93 per share, Mehta said. Production volumes came in higher than anticipated, with the beat being driven by higher International gas, he added.

"On TCO, the company noted completion of TA on the Second Generation Injection plant and progressed start-up of the WPMP project," the analyst wrote. The earnings call could focus on updates on the Hess transaction, commentary around the Tengiz execution, upstream volume outlook, and expectations for capital returns, he further stated.

CVX Price Action: Shares of Chevron had declined by 3.22% to $143.77 at the time of publication on Monday.

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