Chevron’s results are likely to benefit from higher
production volumes. The upstream segment is likely to see higher production,
helped by shale properties and capital projects in the Permian Basin and Gulf
of Mexico. While the downstream segment has experienced some weakness, it remains
to be seen how the second quarter panned out for this business.
In May, Chevron completed the acquisition of Pasadena Refining System Inc. for $350 million. The same month, the company also decided to not pursue the acquisition of Anadarko Petroleum Corp. (NYSE: APC). Anadarko has agreed to be acquired by Occidental Petroleum (NYSE: OXY).
In the first quarter of 2019, Chevron beat earnings estimates but revenues missed. Revenues fell nearly 7% to $35.2 billion while EPS dropped to $1.39 from $1.90 last year.
Chevron’s shares have dropped over 2% in the trailing 52
weeks but have gained 14% thus far this year. The majority of analysts have
rated the stock Buy and the average 12-month price target is $141.88.
Chevron’s rival ExxonMobil (NYSE: XOM) is also set to report its second quarter 2019 earnings results on Friday.