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Chevron Stock Leaps On Q3 Earnings Beat, Best Profit in Eight Years

Chevron posted its strongest quarterly profits in eight years Friday thank in part to a surge in oil and gas prices and broader company cost cuts.

Chevron Corp  (CVX) - Get Chevron Corporation Report posted stronger-than-expected third quarter earnings Friday, including its best profit in eight years, as oil and gas prices surged from last year's pandemic lows. 

Chevron said adjusted earnings for the three months ending in September came in at $2.96 per share, up from 11 cents per share over the the same period last year and 76 cents ahead of the Street consensus forecast.

Group revenues, the company said, surged 76% from last year to $43 billion, again topping analysts' estimates of a $40.52 billion tally. Worldwide net production rose 145,000 barrels from last year to 1.13 million, Chevron said. 

West Texas Intermediate crude prices traded between $75 and $78 per barrel over the three months ending in September, a range that was around 95% higher than the deep pandemic lows recorded over the same period last year.

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“Third quarter earnings were the highest since first quarter 2013 largely due to improved market conditions, strong operational performance and a lower cost structure,” said CEO Mike Wirth.

“Our free cash flow during the quarter was the best ever reported by the company,” Wirth added. “We paid dividends of $2.6 billion, reduced debt by $5.6 billion, and repurchased $625 million of shares during the quarter.”

Chevron shares were marked 1.6% higher in early trading following the earnings release at $115.00 each.

Last month, it will triple its capital investment plans over the coming years, while reaffirming its near-term cash flow forecasts, as the oil major accelerates its transition to lower carbon businesses amid reports of an activist investor challenge.

Chevron will boost its capital investment plans to $10 billion through 2028, the company said, while setting 2030 goals for its new lower carbon businesses that include boosts in renewable natural gas and hydrogen production and increased carbon capture offsets to 25 million tons per year.