Benzinga - by Surbhi Jain, .
Exxon Mobil Corp (NYSE:XOM) and Chevron Corp (NYSE:CVX) stand as two behemoths in the energy sector, both holding significant influence over the global oil and gas industry. Both energy giants are about to report their fourth-quarter earnings on Feb. 2, before market hours.
Wall Street is expecting ExxonMobil to report $2.04 in EPS and $79.28 billion in revenues. Chevron is expected to report $2.96 in EPS and $47.61 billion in revenues.
While both companies operate in the same industry and have evolved through acquisitions and mergers – ExxonMobil in 1999 through the merger of Exxon and Mobil and Chevron with the merger of Chevron and Texaco in 2001 – there are notable differences in their operational strategies, financials, and initiatives.
Also Read: Oil’s Comeback: Middle East Turmoil Pumps Life Into 2024 Markets
Operational Focus
Chevron, while also engaged in upstream activities, balances its portfolio with a significant presence in downstream operations, such as refining and marketing. For 2024, Chevron is targeting an increase in oil production.
2024 Production & Spending Targets
HessPDC EnergyOn the other hand, ExxonMobil is maintaining steady production levels in its plan but anticipates growth through added output from its $60 billion acquisition of Pioneer Natural Resources in the Permian Basin.
In terms of spending, ExxonMobil is allocating a substantial budget of over $20 billion for lower-emissions opportunities until 2027, signifying a noteworthy escalation from the initial $3 billion planned in 2021.
On the other hand, Chevron aims to boost capital spending in 2024, projecting a range between $18.5 billion and $19.5 billion, reflecting an 11% increase from the previous year. Furthermore, Chevron foresees annual spending between $19 billion and $22 billion through 2027.
Sustainability Efforts
In addition to its carbon-related endeavors, Exxon is entering the electric vehicle sector, planning to produce lithium by 2027 and aiming to be a leading lithium supplier for electric vehicles by 2030.
Valuation
Data compiled from Yahoo Finance
Trailing and forward price multiples compare head on when it comes to these two energy giants.
Let’s look at what analysts consensus says:
Data compiled from Yahoo Finance
Analysts do appear to side with ExxonMobil at the moment, with the stock offering 21.7% upside as compared to Chevron offering 19.49% upside.
Clearly, both stocks compare head-on before Q4 earnings. However, their Q4 earnings reports on Friday may cause analysts to re-evaluate their investment stance on these stocks. Investors may want to wait for any major announcements that may cause analysts to reconsider their ratings, before deciding between these stocks.
Read Next: Battleground For Oil Majors: BP Activist Investor Calls For Cut In Green Energy Pledges
Image created using photos from Shutterstock.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.