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Civitas Resources (CIVI)
NYSE:CIVI

Civitas Resources (CIVI) AI Stock Analysis

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Civitas Resources

(NYSE:CIVI)

Rating:81Outperform
Price Target:
$39.00
▲(32.47%Upside)
Civitas Resources shows robust financial performance and attractive valuation metrics, with strong cash flow and a low P/E ratio. The company's strategic financial moves and leadership changes are positive, though operational challenges and market volatility present risks. Technical indicators suggest moderate bullish sentiment in the short term.
Positive Factors
Asset Portfolio
Civitas Resources acquired approximately 19,000 net acres in Midland, adding significant production potential and enhancing its asset portfolio.
Company Leadership
The appointment of Billy Helms to the Board introduces a well-respected industry veteran, which is seen as a positive move for the company's leadership.
Financial Guidance
Management highlighted confidence in delivering full year guidance and hitting 2025 leverage & asset sale targets.
Negative Factors
Asset Sales
CIVI's net-debt target is at risk, especially given that its asset sale target is likely more difficult to achieve in the current volatile macroeconomic environment.
Production Decline
DJ production is expected to decline in 2025 by 9% to 150MBoe/d, which likely limits the value investors place on the asset.
Production Guidance
The company set its guidance below prior estimates and Consensus for both oil production and total production, while capex guidance was above estimates.

Civitas Resources (CIVI) vs. SPDR S&P 500 ETF (SPY)

Civitas Resources Business Overview & Revenue Model

Company DescriptionCivitas Resources, Inc., an exploration and production company, focuses on the acquisition, development, and production of oil and natural gas in the Rocky Mountain region, primarily in the Wattenberg Field of the Denver-Julesburg Basin of Colorado. As of December 31,2021, it had proved reserves 397.7 MMBoe comprising 143.6 MMbbls of crude oil, 106.0 MMbbls of natural gas liquids, and 888.5 Bcf of natural gas. The company was formerly known as Bonanza Creek Energy, Inc. Civitas Resources, Inc. was founded in 1999 and is based in Denver, Colorado.
How the Company Makes MoneyCivitas Resources generates revenue primarily through the sale of oil, natural gas, and natural gas liquids that it extracts from its properties. The company's revenue model is heavily dependent on the production volumes and market prices of these commodities. Key revenue streams include the direct sale of produced hydrocarbons to refiners, marketers, and other purchasers in the energy market. Additionally, Civitas may enter into joint ventures or partnerships to enhance production capabilities or access new technologies, further impacting its revenue. The company's financial performance is also influenced by factors such as production efficiency, operational costs, and regulatory compliance. Market conditions, including supply and demand dynamics, geopolitical events, and environmental regulations, play a significant role in shaping the company's earnings.

Civitas Resources Earnings Call Summary

Earnings Call Date:May 07, 2025
(Q1-2025)
|
% Change Since: 10.68%|
Next Earnings Date:Jul 30, 2025
Earnings Call Sentiment Neutral
The earnings call presented a mixed picture with notable efforts to optimize costs and maintain a strong financial position through hedging and strategic planning. However, production challenges and increased operating costs were significant concerns. The company's strategy to focus on cost efficiency and growth in the Permian Basin is encouraging, yet market volatility and operational hurdles in the DJ Basin and Permian posed challenges.
Q1-2025 Updates
Positive Updates
Cost Optimization and Efficiency Plan
Civitas announced a comprehensive cost optimization and efficiency plan to generate an incremental $100 million of annual free cash flow, with 40% of this benefiting the second half of 2025.
Strong Hedge Position
The company significantly expanded its hedge position, now nearly 50% hedged on crude oil for the remainder of the year, with a hedge value of nearly $200 million.
Leadership Addition
Clay Carrell was introduced as the new President and Chief Operating Officer, bringing deep operating experience and proven leadership to Civitas.
Permian Basin Growth
Civitas expects oil production to grow by 5% in the second quarter, led by growth in the Permian Basin.
Share Repurchase Program
The company completed its existing 10b5 repurchase program, buying back nearly 2% of its shares outstanding.
Negative Updates
First Quarter Production Decline
First quarter production was slightly lower than expectations due to lower capital and weather-related impacts.
Increased Operating Costs
Cash operating costs were higher than planned due to operational challenges with contracted water takeaway in the Permian.
DJ Basin Production Challenges
First quarter volumes reflected a prolonged period with few turn-in-lines, resulting in a significant decline in DJ Basin volumes.
Asset Divestment Challenges
Challenges in the upstream market affected the ability to divest assets, with the company emphasizing they won't be 'price takers.'
Company Guidance
In the first quarter 2025 earnings call for Civitas Resources, the company provided key guidance and metrics related to its financial and operational strategy amid a volatile market environment. Civitas announced a reduction of $150 million in capital expenditures compared to 2024, focusing on capital discipline and lower reinvestment rates. The company aims to generate an additional $100 million in annual free cash flow through a comprehensive cost optimization and efficiency plan, with $15 million anticipated from a new oil gathering agreement in the DJ Basin. Civitas is also targeting a year-end 2025 net debt of $4.5 billion, supported by a nearly 50% hedge on crude oil and planned investment proceeds of $300 million. Despite slightly lower production and higher operating costs in Q1, Civitas expects a 5% production growth in Q2, primarily from the Permian Basin, while maintaining confidence in its full-year guidance. The company remains focused on debt reduction, cost management, and shareholder returns, with an unchanged base dividend and a completed 10b5 repurchase program amounting to nearly 2% of shares outstanding.

Civitas Resources Financial Statement Overview

Summary
Civitas Resources demonstrates strong financial health with impressive revenue growth and excellent cash flow metrics. The balance sheet is solid with low leverage, but operational challenges are reflected in lower EBIT margins.
Income Statement
85
Very Positive
Civitas Resources has shown robust revenue growth, with a significant increase from $930.61 million in 2021 to $5.21 billion in 2024, marking a strong upward trajectory. The gross profit margin is exceptionally high at 99.40% for 2024, indicating efficient cost management. Net profit margin improved to 16.11% in 2024 from 8.40% in 2021, demonstrating enhanced profitability. However, the EBIT margin dropped significantly to 0.08% in 2024, reflecting potential operational challenges.
Balance Sheet
78
Positive
The company maintains a strong equity base with a 44.35% equity ratio in 2024, highlighting financial stability. The debt-to-equity ratio has improved, moving to 0.00 in 2024 from 0.86 in 2020, indicating a reduction in leverage and a stronger balance sheet. Return on equity has decreased slightly to 12.65% in 2024 from 13.63% in 2022, impacted by lower net income relative to equity growth.
Cash Flow
90
Very Positive
Civitas Resources has demonstrated significant growth in free cash flow, increasing from $121.85 million in 2021 to $2.87 billion in 2024, reflecting strong cash generation capabilities. The operating cash flow to net income ratio is robust at 3.42 in 2024, indicating efficient conversion of earnings to cash. Free cash flow to net income ratio is high at 3.42, emphasizing strong cash flow relative to profitability.
BreakdownTTMDec 2024Dec 2023Dec 2022Dec 2021Dec 2020
Income Statement
Total Revenue5.07B5.20B3.48B3.79B930.61M218.09M
Gross Profit2.60B2.14B1.39B2.18B504.25M69.22M
EBITDA3.26B3.60B2.34B2.52B589.30M173.61M
Net Income848.90M838.72M784.29M1.25B178.92M103.53M
Balance Sheet
Total Assets15.33B14.94B14.10B7.97B6.74B1.18B
Cash, Cash Equivalents and Short-Term Investments20.00M75.83M1.12B768.03M254.45M24.74M
Total Debt0.004.49B4.96B418.08M531.98M30.02M
Total Liabilities8.63B8.32B7.92B2.60B2.09B137.56M
Stockholders Equity6.71B6.63B6.18B5.37B4.65B1.05B
Cash Flow
Free Cash Flow1.37B893.36M729.63M1.13B121.85M95.00M
Operating Cash Flow2.77B2.87B2.24B2.48B274.60M158.80M
Investing Cash Flow-2.60B-2.67B-5.24B-1.31B73.55M-63.80M
Financing Cash Flow-199.76M-1.24B3.36B-657.37M-118.44M-81.25M

Civitas Resources Technical Analysis

Technical Analysis Sentiment
Neutral
Last Price29.44
Price Trends
50DMA
28.83
Positive
100DMA
32.42
Negative
200DMA
40.53
Negative
Market Momentum
MACD
-0.03
Positive
RSI
49.80
Neutral
STOCH
14.06
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CIVI, the sentiment is Neutral. The current price of 29.44 is below the 20-day moving average (MA) of 29.87, above the 50-day MA of 28.83, and below the 200-day MA of 40.53, indicating a neutral trend. The MACD of -0.03 indicates Positive momentum. The RSI at 49.80 is Neutral, neither overbought nor oversold. The STOCH value of 14.06 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CIVI.

Civitas Resources Peers Comparison

Overall Rating
UnderperformOutperform
Sector (67)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
81
Outperform
$2.59B3.2112.73%7.27%22.14%5.69%
SMSM
72
Outperform
$2.87B3.5220.28%3.24%26.04%11.96%
BSBSM
70
Outperform
$2.76B14.2619.93%11.47%-12.71%-39.85%
STSTR
70
Outperform
$2.78B35.422.86%7.62%7.18%
67
Neutral
$14.89B9.766.38%5.34%4.12%-66.77%
63
Neutral
$3.63B16.69-16.01%10.44%-139.05%
59
Neutral
$2.85B23.27-3.54%5.58%31.58%-114.70%
* Energy Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
CIVI
Civitas Resources
29.44
-36.02
-55.03%
SM
SM Energy
26.04
-18.28
-41.25%
BSM
Black Stone Minerals
13.14
-1.12
-7.85%
STR
Sitio Royalties
18.45
-4.29
-18.87%
GPOR
Gulfport Energy
190.92
34.06
21.71%
CRGY
Crescent Energy Company Class A
8.88
-2.96
-25.00%

Civitas Resources Corporate Events

Shareholder Meetings
Civitas Resources Holds 2025 Annual Stockholders Meeting
Neutral
Jun 4, 2025

On June 4, 2025, Civitas Resources, Inc. held its 2025 Annual Meeting of Stockholders, where approximately 87% of eligible shares were voted. During the meeting, stockholders elected each director nominee for a one-year term, ratified Deloitte & Touche LLP as the independent accountant for 2025, and approved the compensation of the company’s named executive officers.

The most recent analyst rating on (CIVI) stock is a Buy with a $106.00 price target. To see the full list of analyst forecasts on Civitas Resources stock, see the CIVI Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Civitas Resources Completes $750 Million Senior Notes Offering
Positive
Jun 3, 2025

On June 3, 2025, Civitas Resources, Inc. completed its offering of $750 million in 9.625% Senior Notes due 2033. The proceeds are intended to repay part of the company’s credit facility borrowings. The notes, guaranteed by the company’s subsidiaries, include provisions for optional redemption and change of control, and are subject to covenants and events of default. This strategic financial move aims to enhance Civitas Resources’ financial flexibility and strengthen its market position.

The most recent analyst rating on (CIVI) stock is a Hold with a $42.00 price target. To see the full list of analyst forecasts on Civitas Resources stock, see the CIVI Stock Forecast page.

Private Placements and Financing
Civitas Resources Announces $750M Senior Notes Offering
Positive
May 29, 2025

On May 29, 2025, Civitas Resources announced the pricing of an upsized private placement of $750 million in new 9.625% senior unsecured notes due 2033. The offering, expected to close on June 3, 2025, will help repay part of the company’s revolving credit facility, potentially strengthening its financial position and operational flexibility.

The most recent analyst rating on (CIVI) stock is a Hold with a $42.00 price target. To see the full list of analyst forecasts on Civitas Resources stock, see the CIVI Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Civitas Resources Updates Credit Agreement Terms
Neutral
May 29, 2025

On May 28, 2025, Civitas Resources, Inc. announced an Eighth Amendment to its Amended and Restated Credit Agreement, which includes a reduction of the Borrowing Base from $3.4 billion to $3.3 billion, while maintaining the elected loan limit at $2.5 billion. The amendment also modifies the maturity terms of the revolving credit facility, potentially impacting the company’s financial strategy and flexibility.

The most recent analyst rating on (CIVI) stock is a Hold with a $42.00 price target. To see the full list of analyst forecasts on Civitas Resources stock, see the CIVI Stock Forecast page.

Private Placements and FinancingBusiness Operations and Strategy
Civitas Resources Announces $500M Senior Notes Offering
Neutral
May 29, 2025

On May 29, 2025, Civitas Resources announced its intention to offer $500 million in senior unsecured notes due 2032 in a private placement, subject to market conditions. The proceeds from this offering are expected to be used to repay a portion of the company’s outstanding borrowings under its revolving credit facility, which could impact its financial strategy and operations.

The most recent analyst rating on (CIVI) stock is a Hold with a $42.00 price target. To see the full list of analyst forecasts on Civitas Resources stock, see the CIVI Stock Forecast page.

Executive/Board ChangesBusiness Operations and Strategy
Civitas Resources Appoints New President and COO
Positive
May 7, 2025

On May 7, 2025, Civitas Resources appointed Clayton A. Carrell as President and Chief Operating Officer, effective immediately. Carrell brings over 35 years of experience in the oil and gas industry, having previously held leadership roles at Southwestern Energy and EP Energy. His appointment is expected to enhance Civitas’ operational capabilities and strategic execution, particularly in the Permian and DJ Basins, as the company focuses on delivering value for shareholders through its scaled development programs.

Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jun 25, 2025