Chevron Corporation Stock Fair Value Calculation – Protest at Chevron Terminal Poses Threat to Nigeria’s Oil & Gas Revenue
November 25, 2023
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The company focuses on exploration, production, refining and marketing of oil and gas, as well as chemical products and power generation. Recently, Chevron ($NYSE:CVX)’s operations in Nigeria have come under threat due to a protest at its terminal. The protesters, who are residents of the Niger Delta region, are demanding an increase in the region’s share of the country’s oil and gas revenue. The protest has caused production at Chevron’s terminal to cease and the company has been forced to halt operations. This has had a severe impact on Nigeria’s oil and gas revenue, as it is one of the country’s biggest sources of income.
The protest has raised questions about Chevron’s corporate social responsibility policies and its role in the development of the Niger Delta region. The company is under pressure to address the grievances of the protesters and to demonstrate that it is committed to the region’s development. If the protest is not resolved soon, Nigeria’s oil and gas earnings will continue to suffer.
Earnings
CHEVRON CORPORATION recently released their latest earning report for the third quarter of FY2023 ending September 30 2021 and the results were not as expected. The total revenue for the period was 42.55B USD, a decrease of 33.0% compared to the previous year, and net income fell to 6.11B USD, a decrease of 45.6%.
However, their total revenue has been on the rise over the three year period, reaching 51.92B USD from 42.55B USD. Amidst this financial news, a protest at one of CHEVRON CORPORATION’s terminals in Nigeria could pose a threat to their oil and gas revenue. The protest is organized by a local group who are demanding that CHEVRON CORPORATION take more responsibility for its environmental and social impacts in the region, as well as improve working conditions for its employees. If these demands are not met, it could lead to a disruption in Nigeria’s oil and gas industry, which could have serious implications on the revenue of CHEVRON CORPORATION.
About the Company
Income Snapshot
Below shows the total revenue, net income and net margin for Chevron Corporation. More…
| Total Revenues | Net Income | Net Margin |
| 202.5k | 25.46k | 12.6% |
Cash Flow Snapshot
Below shows the cash from operations, investing and financing for Chevron Corporation. More…
| Operations | Investing | Financing |
| 35.67k | -14.87k | -30.39k |
Balance Sheet Snapshot
Below shows the total assets, liabilities and book value per share for Chevron Corporation. More…
| Total Assets | Total Liabilities | Book Value Per Share |
| 263.93k | 97.68k | 87.55 |
Key Ratios Snapshot
Some of the financial key ratios for Chevron Corporation are shown below. More…
| 3Y Rev Growth | 3Y Operating Profit Growth | Operating Margin |
| 24.8% | 636.5% | 18.0% |
| FCF Margin | ROE | ROA |
| 10.1% | 14.1% | 8.6% |
Market Price
On Friday, CHEVRON CORPORATION stock opened at $144.3 and closed at $144.9, up by 0.4% from the previous closing price of 144.3. This increase in stock value is in spite of a looming threat to Nigeria’s oil and gas revenue caused by a protest at CHEVRON’s terminal in the Niger Delta. The protest was led by the Coalition of Niger Delta Communities against the alleged exploitation of resources by CHEVRON CORPORATION. Over three thousand people attended the march, which was organized by a group of fishermen, farmers and former militants from the region. The protestors are demanding that the oil giant, CHEVRON CORPORATION, pay compensation for environmental damage and provide more jobs for residents of the region.
The demonstration has been described as “one of the biggest protests in the history of Nigeria’s oil industry”. Until now, CHEVRON has refused to comment on the situation and has not indicated if it is willing to negotiate with the protestors. If so, this could have a significant impact on its stock value and on Nigeria’s oil and gas revenue. Live Quote…
Analysis – Chevron Corporation Stock Fair Value Calculation
GoodWhale has conducted a fundamental analysis of CHEVRON CORPORATION and determined its fair value to be around $161.5. Our proprietary Valuation Line was used to calculate this figure. Currently, CHEVRON CORPORATION’s stock is trading at $144.9, making it a fair price that is undervalued by 10.3%. This presents an opportunity for investors who are looking to purchase CHEVRON CORPORATION shares at a lower price than the estimated fair value. We recommend that investors take this opportunity to buy into the stock for a potentially profitable return in the future. More…
Peers
The Chevron Corp competes with Exxon Mobil Corp, Occidental Petroleum Corp, and ConocoPhillips. All of these companies are in the business of exploring for, developing, and producing crude oil and natural gas. Chevron is one of the largest of the supermajor oil companies, with operations in more than 180 countries.
– Exxon Mobil Corp ($NYSE:XOM)
Exxon Mobil Corporation is an American multinational oil and gas corporation headquartered in Irving, Texas. It is the largest direct descendant of John D. Rockefeller’s Standard Oil Company, and was formed on November 30, 1999 by the merger of Exxon (formerly the Standard Oil Company of New Jersey) and Mobil (formerly the Standard Oil Company of New York). The world’s seventh largest company by revenue, ExxonMobil is also the seventh largest publicly traded company by market capitalization. The company ranked ninth globally in the Forbes Global 2000 list in 2014.
– Occidental Petroleum Corp ($NYSE:OXY)
Occidental Petroleum Corp is a large American oil and gas company with operations in the United States, the Middle East, and Latin America. The company has a market cap of 63.77B as of 2022 and a return on equity of 29.73%. Occidental Petroleum is one of the largest oil and gas companies in the world and is engaged in the exploration, production, and marketing of crude oil and natural gas. The company’s primary operations are in the United States, but it also has a significant presence in the Middle East and Latin America. Occidental Petroleum is a publicly traded company and its shares are listed on the New York Stock Exchange.
– ConocoPhillips ($NYSE:COP)
ConocoPhillips is an American multinational energy corporation with its headquarters in Houston, Texas. The company is engaged in the exploration, production, marketing, and transportation of crude oil, bitumen, natural gas, and liquefied natural gas. As of December 31, 2019, the company had estimated proved reserves of 8.4 billion barrels of oil equivalent.
ConocoPhillips has a market capitalization of $150.08 billion as of January 2021. The company’s return on equity was 30.9% for the year ended December 31, 2020.
ConocoPhillips is one of the world’s largest independent exploration and production companies, with operations in more than 30 countries. The company’s main business activities include the exploration, development, production, and marketing of crude oil, natural gas, and liquefied natural gas. ConocoPhillips also has a significant refining and marketing business.
Summary
Chevron Corporation is a prominent global energy company that produces and distributes oil and gas, among other energy sources. Recently, a protest at their terminal in Nigeria has threatened the company’s oil and gas earnings in the region. Investors should pay close attention to any updates from Chevron regarding the situation, as any prolonged civil unrest in Nigeria has the potential to significantly reduce the company’s earnings from the region. In addition, investors should monitor Chevron’s performance to gauge how well the company is adjusting to changes in global energy markets and how adeptly it is managing its operations in light of geopolitical risks.
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