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“Strategy Integration”: Chevron Stock (NYSE:CVX) Gains With Huge Hess Layoffs

Story Highlights

Chevron cuts former Hess employees loose, and further consolidation may follow with increasing Exxon overlap.

“Strategy Integration”: Chevron Stock (NYSE:CVX) Gains With Huge Hess Layoffs

It was likely only a matter of time, but oil stock Chevron (CVX) is cutting former Hess jobs based on reports supplied to the Texas Workforce Commission (TWC). In fact, the newest reports say that Chevron is gutting the Hess operation, with over one in three Hess workers now former Hess workers. Chevron shareholders, however, are reasonably pleased, and they sent shares up modestly in Thursday afternoon’s trading.

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The reports note that Chevron intends to cut 575 jobs at the Houston Hess office. That represents over a third of Hess’ overall workforce, as Hess had 1,585 people employed in the United States and another 212 abroad as of the end of 2024. Chevron called the layoffs “…a result of the strategic integration of Hess Corporation and Chevron Corporation to position our combined organizations for stronger long-term competitiveness.”

The layoffs will actually start September 26, so at least the soon-to-be-fired employees will have some time to start looking for jobs before they no longer have one with Chevron. Then, in perhaps the unkindest cut, general manager for state government affairs Julie Williams noted “We deeply value the contributions of our employees, and we are offering resources and benefits to impacted employees, including severance pay, cash to defray the cost of health coverage and company-paid transition services.”

More to Come?

There is a possibility that Chevron will see more layoffs down the line. In fact, a recent report noted that there was some “overlap” in operations between Chevron and Exxon (XOM) following a set of “recent deals.”

With the energy market increasingly volatile, there is a growing push to consolidate operations to better weather the upticks and downticks accordingly. And with Chevron and Exxon already overlapping in many places, can such a consolidation be far behind? With consolidation, of course, comes redundancy, and with redundancy, layoffs. It is almost as inevitable as the tides, and we may well see more of this to come.

Is Chevron a Buy or Sell Today?

Turning to Wall Street, analysts have a Moderate Buy consensus rating on CVX stock based on nine Buys, five Holds, and one Sell assigned in the past three months, as indicated by the graphic below. After a 2.81% loss in its share price over the past year, the average CVX price target of $164.87 per share implies 6.66% upside potential.

See more CVX analyst ratings

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