Chevron surges after hiking stock buyback plans to as much as $10B annually
Chevron (CVX +3.4%) tops the Dow Jones index and hits a new 52-week high after raising its stock buyback program to $5B-10B per year, up from previous plans for $3B-5B of annual repurchases.
At its annual investing meeting, the company also targets a 12% return on capital employed by 2026 at $60/bbl Brent crude, and forecasts operating cash flow per share to grow 10% annually through 2026, benefiting from reduced costs and surging energy prices.
Additionally, Chevron reaffirms targets to lower the carbon intensity of its operations and grow new energy business lines in renewable fuels, hydrogen, carbon capture and offsets.
Separately, Chevron CEO Mike Wirth says he has received no indications that the Caspian pipeline connecting the Tengiz field in Kazakhstan to global markets will be interrupted after Russia invaded Ukraine.
The pipeline, which crosses part of Russia and supplies more than 1M bbl/day, is Chevron's only direct exposure to the Ukraine conflict.
Free cash flow growth, restrained capital spending and a strong balance sheet are powerful positives for Chevron shares, Chuck Walston writes in a bullish analysis posted recently on Seeking Alpha.