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The Zacks Analyst Blog Highlights Chevron and Renewable Energy Group
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For Immediate Release
Chicago, IL – March 2, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Chevron (CVX - Free Report) and Renewable Energy Group .
Here are highlights from Tuesday’s Analyst Blog:
Chevron Just Acquired a Big Name in Renewable Energy
Chevron, the widely-known oil and gas giant, has just made a deal to acquire a leading biofuel and renewable chemical company.
The deal is said to stem from the oil and gas industry's recent initiatives to produce cleaner sources of energy and meet new emission standards. Fossil-fuel carbon emissions are one of the biggest contributors to global warming.
Let's take a look into Chevron's acquisition of Renewable Energy Group and see how it helps the oil-gas industry's glaring need and want to reduce carbon emissions.
Regulations & Increasing Pressure on Carbon Emissions
Chevron has been under immense pressure by not only investors, but the government as well to increase its investment in green and cleaner energy over the last several years.
Carbon emissions have significantly sped up the rate of global warming and many know how critical it is to adopt green and cleaner forms of energy.
Many oil and gas companies have pledged to a net-zero carbon emission world, caving into increased pressure and stricter regulations set forth by the government. Chevron currently has no plans to go net-zero due to its incapability of doing so.
However, Chevron has pledged to drastically increase its investment in its low-carbon emissions and plans to decrease the overall number of carbon emissions created from its business processes and technologies.
Chevron's Commitment to Clean Energy
To facilitate needs, regulations, and demands, Chevron has acquired Renewable Energy Group in an all-cash deal valued at $3.15 billion, or $61.50 per share.
This acquisition will allow Chevron to implement Renewable Energy Group's rising rate of renewable fuels production with Chevron's massively established manufacturing and distribution processes and capabilities.
Chevron does not plan to stop its commitment there, however. In 2021, Chevron announced that it would nearly triple its investment from around $3 billion to $10 billion through 2028 in low-carbon technologies and processes.
Chevron's CEO believes that significantly increasing its investment in low-carbon technologies and processes will allow them to explore new opportunities while having the ability to reinvest gains in its core business.
Chevron also believes that its investment in this area would be much more fruitful if incentives to do so were in place. One of the incentives they would like to take advantage of is carbon emission offset credits that it could sell to other companies. Each year, Chevron says that it would offset roughly 25 million metric tons of carbon emissions.
The deal is expected to speed up Chevron's goal of growing its renewable fuels production capacity to 100,000 barrels a day by the year 2023. It will also allow Chevron to build strength and accelerate growth across the renewable fuels value chain.
Why Chevron Chose Renewable Energy Group
Renewable Energy Group is the leading biofuel and renewable chemical producer in the United States by volume. It is focused on providing the world with cleaner and lower carbon transportation fuels by using sources such as corn, cooking oil, inedible animal fat, and others to produce its products.
Chevron is aware that Renewable Energy Group is one of the founders and most successful innovators of the renewable fuels industry. Together, the companies believe that they can grow much quicker and more efficiently than ever before, while also expecting a favorable increase in EPS and free cash flow.
REGI will inherit many resources due to the acquisition. One of the biggest benefits of being acquired by Chevron is that it is a giant in the oil and gas industry; REGI will be able to take full advantage of Chevron's massively pre-established technologies and processes.
Investors have had a favorable view of the acquisition; REGI is up roughly 40% on the day of writing this. REGI is currently a Zacks Rank #3 (Hold).
Future Outlook for Chevron
Chevron has just taken a massive step forward in its commitment to lower carbon emissions by acquiring Renewable Energy Group. The pressure and demands from investors and other officials have increased immensely for cleaner energy due to carbon emissions being the main contributor to global warming.
Tripling their investment in low carbon emissions last year has also been a massive step forward for Chevron and the rest of the industry. Being seen as a top player in the oil and gas industry, Chevron has the power to influence the rest of the world to follow it on its green energy path.
The acquisition is expected to vastly accelerate growth across the renewable fuels value chain and Chevron hopes to take advantage of carbon emission offset credit incentives. Chevron states that this acquisition will allow them to explore many more opportunities and improve their main business overall.
The deal has been approved by both boards and is expected to close sometime in the second half of 2022. CVX is currently a Zacks Rank #2 (Buy), and EPS is forecasted to grow by 8.3% over the next three to five years.
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Last year's 2021 Zacks Top 10 Stocks portfolio returned gains as high as +147.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don't miss your chance to get in on these long-term buys
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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The Zacks Analyst Blog Highlights Chevron and Renewable Energy Group
For Immediate Release
Chicago, IL – March 2, 2022 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Chevron (CVX - Free Report) and Renewable Energy Group .
Here are highlights from Tuesday’s Analyst Blog:
Chevron Just Acquired a Big Name in Renewable Energy
Chevron, the widely-known oil and gas giant, has just made a deal to acquire a leading biofuel and renewable chemical company.
The deal is said to stem from the oil and gas industry's recent initiatives to produce cleaner sources of energy and meet new emission standards. Fossil-fuel carbon emissions are one of the biggest contributors to global warming.
Let's take a look into Chevron's acquisition of Renewable Energy Group and see how it helps the oil-gas industry's glaring need and want to reduce carbon emissions.
Regulations & Increasing Pressure on Carbon Emissions
Chevron has been under immense pressure by not only investors, but the government as well to increase its investment in green and cleaner energy over the last several years.
Carbon emissions have significantly sped up the rate of global warming and many know how critical it is to adopt green and cleaner forms of energy.
Many oil and gas companies have pledged to a net-zero carbon emission world, caving into increased pressure and stricter regulations set forth by the government. Chevron currently has no plans to go net-zero due to its incapability of doing so.
However, Chevron has pledged to drastically increase its investment in its low-carbon emissions and plans to decrease the overall number of carbon emissions created from its business processes and technologies.
Chevron's Commitment to Clean Energy
To facilitate needs, regulations, and demands, Chevron has acquired Renewable Energy Group in an all-cash deal valued at $3.15 billion, or $61.50 per share.
This acquisition will allow Chevron to implement Renewable Energy Group's rising rate of renewable fuels production with Chevron's massively established manufacturing and distribution processes and capabilities.
Chevron does not plan to stop its commitment there, however. In 2021, Chevron announced that it would nearly triple its investment from around $3 billion to $10 billion through 2028 in low-carbon technologies and processes.
Chevron's CEO believes that significantly increasing its investment in low-carbon technologies and processes will allow them to explore new opportunities while having the ability to reinvest gains in its core business.
Chevron also believes that its investment in this area would be much more fruitful if incentives to do so were in place. One of the incentives they would like to take advantage of is carbon emission offset credits that it could sell to other companies. Each year, Chevron says that it would offset roughly 25 million metric tons of carbon emissions.
The deal is expected to speed up Chevron's goal of growing its renewable fuels production capacity to 100,000 barrels a day by the year 2023. It will also allow Chevron to build strength and accelerate growth across the renewable fuels value chain.
Why Chevron Chose Renewable Energy Group
Renewable Energy Group is the leading biofuel and renewable chemical producer in the United States by volume. It is focused on providing the world with cleaner and lower carbon transportation fuels by using sources such as corn, cooking oil, inedible animal fat, and others to produce its products.
Chevron is aware that Renewable Energy Group is one of the founders and most successful innovators of the renewable fuels industry. Together, the companies believe that they can grow much quicker and more efficiently than ever before, while also expecting a favorable increase in EPS and free cash flow.
REGI will inherit many resources due to the acquisition. One of the biggest benefits of being acquired by Chevron is that it is a giant in the oil and gas industry; REGI will be able to take full advantage of Chevron's massively pre-established technologies and processes.
Investors have had a favorable view of the acquisition; REGI is up roughly 40% on the day of writing this. REGI is currently a Zacks Rank #3 (Hold).
Future Outlook for Chevron
Chevron has just taken a massive step forward in its commitment to lower carbon emissions by acquiring Renewable Energy Group. The pressure and demands from investors and other officials have increased immensely for cleaner energy due to carbon emissions being the main contributor to global warming.
Tripling their investment in low carbon emissions last year has also been a massive step forward for Chevron and the rest of the industry. Being seen as a top player in the oil and gas industry, Chevron has the power to influence the rest of the world to follow it on its green energy path.
The acquisition is expected to vastly accelerate growth across the renewable fuels value chain and Chevron hopes to take advantage of carbon emission offset credit incentives. Chevron states that this acquisition will allow them to explore many more opportunities and improve their main business overall.
The deal has been approved by both boards and is expected to close sometime in the second half of 2022. CVX is currently a Zacks Rank #2 (Buy), and EPS is forecasted to grow by 8.3% over the next three to five years.
Chevron Corporation price-consensus-chart | Chevron Corporation Quote
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In addition to the investment ideas discussed above, would you like to know about our 10 top buy-and-hold tickers for the entirety of 2022?
Last year's 2021 Zacks Top 10 Stocks portfolio returned gains as high as +147.7%. Now a brand-new portfolio has been handpicked from over 4,000 companies covered by the Zacks Rank. Don't miss your chance to get in on these long-term buys
Access Zacks Top 10 Stocks for 2022 today >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.