Chevron shares continue to trade above $85 support after disappointing Q4 results

By:
on Feb 11, 2021
Updated: Feb 29, 2024
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  • Chevron shares have advanced more than 9% since the beginning of January
  • If the price falls below the $85 support level, it would be a firm "sell" signal
  • Total revenue has decreased by -30.5% in Q4

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Chevron (NYSE: CVX) shares have advanced more than 9% since the beginning of January, and the current share price stands around $92. The company reported Q4 results in the last week of January; total revenue has decreased by -30.5%, and for the 2020 fiscal year, Chevron reported a loss of $5.5B.

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Fundamental analysis: Total revenue has decreased by -30.5% in Q4

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Chevron Corporation is an American multinational energy corporation engaged in every aspect of oil and natural gas; 70% of its reserves are concentrated in the U.S., Australia, Kazakhstan, and the Gulf of Mexico. Chevron shares are advancing in 2021, and the technical picture implies that the price could advance again above $95 resistance this February.

Chevron reported Q4 results in the last week of January; total revenue has decreased by -30.5% Y/Y to $25.25B while Q4 GAAP EPS was -$0.33 (missed by $0.40). Total revenue has decreased above the expectations (-$720M), and the company has posted its first annual loss since 2016.

“The global pandemic results in a devastating loss of life and historic collapse in the global economy and extremely volatile oil markets. We began the year in a strong position, and we took swift action to adapt to the new realities as they emerged,” said Mike Wirth, Chairman, and CEO.

Revenues have decreased mainly due to the Covid-19 pandemic, and for the 2020 fiscal year, Chevron reported a loss of $5.5B. On the other side, Chevron has completed one of its largest restructuring phases and integration of Noble employees transparently and equitably.

Chevron acquired Noble Energy last summer, and according to the latest news, the company is buying small pipeline Master Limited Partnership Noble Midstream Partners (NBLX). The further stimulus’s expectations lifted Brent crude oil prices above $60 a barrel while CFO Pierre Breber said that Brent oil cash break-even price, excluding working capital, was under $50 for the second quarter in a row.

Oil price continues to perform well, and maybe now is the right moment to trade Chevron shares. Analysts stay “bullish” on Chevron over the long term, and with a market capitalization of $178B, shares of this company are not expensive.

Technical analysis: The first sign of the trend reversal could be if the price falls below the $85 support

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Chevron shares are advancing last several months, and the first sign of the trend reversal could be if the price falls below the $85 support.

Data source: tradingview.com

The critical support levels are $85, $80, and $70; $95 and $100 represent the resistance levels. If the price jumps above $95, it would be a signal to buy shares, and the next target could be around $100 or even $105.

If the price falls below the $85 support level, it would be a firm “sell” signal, and the price could fall to $70.

Summary

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Chevron reported Q4 results in the last week of January; total revenue has decreased by -30.5%, and the company has posted its first annual loss since 2016. Chevron shares are advancing last several months, and the first sign of the trend reversal could be if the price falls below the $85 support.

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