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Barclays (LON:BARC) maintained its Equalweight rating on Chevron (NYSE:CVX) with a price target of $152.00 on Wednesday. Currently trading at $148.19, the oil giant appears undervalued according to InvestingPro’s Fair Value analysis, while maintaining a robust 4.6% dividend yield with 37 consecutive years of dividend increases.
The research firm noted that given Chevron’s organic growth since 2023, the Hess (NYSE:HES) deal is now "modestly accretive to CVX’s cash flow multiples and leverage albeit still dilutive on FCF yield."
Barclays sees "balanced risk/reward around arbitration outcome" related to the Hess acquisition and explained its differing position on estimates.
The firm’s analysis suggests the Hess transaction, which has been a focal point for investors, now presents a slightly improved financial outlook for Chevron compared to earlier assessments.
Chevron’s stock rating and price target remain unchanged from Barclays’ previous evaluation, with the $152 price target reflecting the firm’s current valuation of the energy giant.
In other recent news, Chevron Corporation has made a strategic move into the lithium market by acquiring approximately 125,000 net acres of lithium-rich land in Northeast Texas and Southwest Arkansas. The acquisition from TerraVolta Resources and East Texas Natural Resources LLC marks Chevron’s initial step toward establishing a commercial-scale domestic lithium business. The company plans to utilize direct lithium extraction technology, which is expected to offer faster and more efficient production with a smaller environmental footprint. In a separate development, TotalEnergies (EPA:TTEF) has acquired a 25% stake in several U.S. offshore blocks operated by Chevron, expanding its exploration footprint in U.S. waters. Additionally, Chevron held its Annual Meeting of Stockholders, where shareholders approved key governance proposals, including an amendment to the company’s Restated Certificate of Incorporation for officer exculpation. The meeting also saw strong support for the board of directors and executive compensation, while several climate-related proposals were rejected. These developments reflect Chevron’s strategic initiatives to diversify its energy portfolio and enhance its governance framework.
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