3. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 53
Chevron Corporation (NYSE:CVX), a successor of Standard Oil, is a multinational American producer of oil, gasoline, natural gas, and other petrochemicals. The stock has gained roughly 39% in the last six months, and the company posted a Q4 revenue of $48.13 billion, up 90.64% year-on-year, outperforming market consensus.
Chevron Corporation (NYSE:CVX) on January 26 declared a $1.42 per share quarterly dividend, a 6% increase from its prior dividend of $1.34. The dividend will be paid on March 10, to shareholders of record on February 16.
On February 23, Chevron Corporation (NYSE:CVX) unveiled a pilot project with Project Canary to lower and independently certify methane emissions at five oil well sites in Texas and Colorado.
Cowen analyst Jason Gabelman raised the price target on Chevron Corporation (NYSE:CVX) on February 23 to $140 from $133 and kept an Outperform rating on the shares. The analyst expects Chevron Corporation (NYSE:CVX)’s upcoming analyst day to deliver updated guidance and an update on TCO which is its largest project and it remains a top pick.
Warren Buffett’s Berkshire Hathaway is the biggest Chevron Corporation (NYSE:CVX) stakeholder as of Q4 2021, with 38.2 million shares worth $4.4 billion. Overall, 53 hedge funds were bullish on Chevron Corporation (NYSE:CVX), up from 51 funds in the prior quarter.
Here is what Goehring & Rozencwajg Associates has to say about Chevron Corporation (NYSE:CVX) in its Q3 2021 investor letter:
“After successfully replacing 25% of Exxon’s board of directors despite owning just 0.02% of the outstanding equity, Engine No. 1, the climate-focused activist hedge fund, met with Chevron’s management late last summer. In discussions that were later described as “cordial,” Chevron executives shared their plan to reduce carbon emissions. Subsequently, Chevron announced new plans to further reduce carbon output, along with their intention to appoint a new director with “environmental expertise.” Although it remains unclear exactly what Engine No. 1 is planning, rumors suggest the fund has contacted other investors, strongly suggesting they intend to launch a second campaign in the not-too-distant future.
What should Chevron expect?
It was recently reported by The Wall Street Journal that Exxon was considering abandoning two massive natural gas projects: the 75 trillion cubic foot (tcf ) Rovuma LNG project (capital cost $30 bn) and the 5 tcf Ca Voi Xanh offshore-Vietnam gas project (capital cost $10 bn). Exxon board members (most likely including the three supported by Engine No. 1) have publicly expressed concerns about both projects. According to internal reports, these projects are among the highest CO2 producers in Exxon’s pipeline; it is no surprise these projects have been called into question. However, we find the plight of both fields to be perplexing since production would almost certainly be used to displace coal in electricity generation, cutting CO2 emissions by nearly 50%. This fact seems to be lost on the new Exxon board members.”
