COMPANY DESCRIPTION

Chevron Corporation (Chevron or the company) is one of the leading integrated energy companies in the world. The company is engaged in every aspect of the oil and natural gas industry, including exploration and production, refining, marketing and transportation, chemicals manufacturing and sales, geothermal, mining operations, and power generation. It has operations in more than 100 countries including the US. Chevron is headquartered in San Ramon, California 

 

ECONOMIC MOAT

In our opinion Chevron has an economic moat that relies for the most part on its upstream operations. Compared with other major integrated oil companies, Chevron has a small refining footprint. Chevron benefits from skills and expertise developed through years of successful deep-water exploration.

 

OUTLOOK

Like many of its supermajor peers, Chevron saw its sales and earnings tumble in 2014.  Chevron has halted its share-repurchase program and is shaving its capital spending budget. This high-quality issue has a decent measure of recovery potential over the span to 2018-2020. Over this time frame, demand for energy should have rebounded somewhat, permitting oil prices to rise. Meantime, the generous and predictable dividend should provide a pleasant sweetener.

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STRENGTHS

  • Presence across the energy value chain

  • Wide geographic presence

  • Leading market position 

WEAKNESSES

  • Decline in financial performance 

THREATS

  • Regulation of greenhouse gas emissions

  • Civil unrest in Nigeria threatens crude oil production

  • Commodity prices risks

  • Economic conditions 

OPPORTUNITIES

  • Planned investments for future development

  • Strategic acquisitions and agreements 

The above report is for information purposes only, and is not a solicitation or offer to buy or sell any securities. Past performance is no guarantee of future performance. Neither diversification nor asset allocation ensures a profit or guarantees against loss. Before investing, investors should consider their risk tolerance, investment objectives, time horizon, available capital, and charges and expenses.  

 

The information presented in this report has been obtained from sources believed to be reliable, but accuracy and completeness cannot be guranteed. All material is subject to change without notice. The views and opinions expressed are those of Focused Stock Research and/or WALT ST Investment Management, Ltd. and in no way reflect the views and opinions of Investment Consultants nor their Broker Dealers.

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