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Chevron Corporation
Chevron Corporation (NYSE: CVX) is an integrated energy entity with exploration, production, and refining operations globally.
Investment Highlights – HOLD at USD 101.23
Key Risks
Recent News
Leadership Appointment: CVX appointed Eimear Bonner as vice president, while he will continue as President of Chevron Technical Center.
Q2 FY21 Financial Highlights (for the three months ended 30 June 2021, as of 30 July 2021)
(Source: Company Website)
One Year Share Price Chart
(Data Source: REFINITIV, Analysis done by Kalkine Group)
Valuation Methodology: Price/Earnings Approach (Illustrative)
Conclusion
Chevron has curtained the capital spending by 32% in H1 FY21 from a year ago. The Company also continued to pursue the development of renewable and lower carbon fuels. During the Q2 FY21, CVX also settled pension costs of US$115 million and sold assets of US$120 million, which supported the cash flows. The Company has got a boost with favourable sales price of natural gas and crude oil. The stock made a 52-week High and Low of USD 113.11 and USD 65.16, respectively.
Based on improved market conditions, robust financials, share repurchase resumption, solid free cash flow, supported by the valuation conduced above, we have given a "HOLD" stance on Chevron Corporation at the closing market price of USD 101.23 (as of 5 August 2021), while we look forward to fresh buying once short-term uncertainty subsides.
Halliburton Company
Founded in 1919, Halliburton Company (NYSE: HAL) provides products and services to the energy industry. It services include drilling and formation evaluation, managing geological data, optimizing production, and locating hydrocarbons.
Investment Highlights – HOLD at USD 19.48
Key Risks
Q2 FY21 Financial Highlights (for the three months ended 30 June 2021, as on 23 July 2021)
(Source: Company Website)
One Year Share Price Chart
(Data Source: REFINITIV, Analysis done by Kalkine Group)
Valuation Methodology: Price/Earnings Approach (FY21) (Illustrative)
Conclusion
HAL demonstrated solid growth across all divisions in Q2 FY21. The completion and production revenue in Q2 FY21 was US$178 million higher than Q1 FY20. The growth was driven by increased activity across multiple product service lines. The solid free cash flows also reflected the effectiveness of strategy and strong customer demand. The drilling and evaluation revenue also surged 5% year-on-year in Q1 FY21, which offset the reduced software sales globally. In a nutshell, the Company has sustainable competitive advantage, and integrated service portfolio to generate industry-leading returns. The stock made a 52-week High and Low of USD 25.00 and USD 10.60, respectively.
Based on the new business opportunities, strong free cash flows, profitable growth across divisions, supported by the valuation conducted above, we have given a "HOLD" stance on Halliburton Company at the closing market price of USD 19.48 (as of 5 August 2021), while we look to fresh buying when short-term uncertainty fades away.
*All forecasted figures and Industry Information have been taken from REFINITIV.
*Dividend Yield may vary as per the stock price movement.
*The reference data in this report has been partly sourced from REFINITIV.
Disclaimer
The advice given by Kalkine Canada Advisory Services Inc. and provided on this website is general information only and it does not take into account your investment objectives, financial situation and the particular needs of any particular person. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. The website www.kalkine.ca is published by Kalkine Canada Advisory Services Inc. The link to our Terms & Conditions has been provided please go through them. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations later.