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Chevron stock price target raised by Jefferies on slightly weaker Q1

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On Monday, Jefferies maintained a positive outlook on Chevron (NYSE:), raising its price target to $190 from the previous $184 while keeping a Buy rating on the stock. The financial firm anticipates a slightly weaker first quarter for Chevron, with cash flow per share (CFPS) expected to be around 4% below the consensus. This forecasted dip is attributed to timing effects, turnarounds, and working capital headwinds.

The analyst from Jefferies projects a weaker quarter for Chevron’s downstream sector despite higher margins, due to heavy turnarounds estimated to cost between $250 million and $350 million. This comes in addition to a reversal of timing effects that had previously boosted downstream earnings by approximately $485 million in the fourth quarter of 2023.

U.S. production is also expected to be weaker, approximately 2% below consensus, impacted by around 20,000 barrels of oil equivalent per day (boepd) of downtime due to winter weather in North America.

This is on top of Chevron’s guidance from the fourth quarter indicating that Permian volumes in the first half of 2024 would be 2-4% below those of the fourth quarter of 2023, with the DJ basin expected to decrease quarter over quarter.

Despite these setbacks, productivity in the Permian/DJ and international sectors remains strong, with the Tengizchevroil (TCO) West Qurna Phase 2 (WPMP) project set to start in the second quarter of 2024, remaining on schedule.

Furthermore, the analyst expects working capital builds in the first quarter due to tax payables, which should reverse later in the year, and minimal affiliate dividends this quarter. However, Chevron’s share repurchases are forecasted to be near the high end of guidance, around $3 billion, with a margin of about 20%.

Regarding the acquisition of Hess Corporation (NYSE:) by Chevron, a shareholder vote is anticipated in the second quarter, which may influence buyback strategies. The deal is also awaiting approval from the Federal Trade Commission (FTC), and while Jefferies expects it to be approved, the closure of the deal could be delayed to the fourth quarter of 2024 due to arbitration over ExxonMobil (NYSE:)’s potential Right of First Refusal (ROFR).

The consolidation of arbitration cases is seen as a positive sign for a potentially quicker resolution.

Lastly, the Jefferies analyst has updated estimates with Henry Hub (HH) and West Texas Intermediate (WTI) prices of $2.39/$3.50 per thousand cubic feet (mcf) and $79.88/$74.49 per barrel for 2024 and 2025, respectively. However, the firm’s normalized pricing forecasts for Henry Hub and WTI at $4/mcf and $65/barrel remain unchanged.

InvestingPro Insights

As Chevron (NYSE:CVX) navigates a potentially weaker first quarter, per Jefferies’ analysis, it’s worth noting some key financial metrics and market insights that could interest investors. Chevron has demonstrated a strong track record with a market capitalization of $300.13 billion and a P/E ratio sitting at a comfortable 14.12, indicating a potentially undervalued stock when looking at the adjusted P/E ratio of the last twelve months as of Q4 2023, which is 13.18.

InvestingPro Tips highlight Chevron’s consistency in rewarding shareholders, having raised its dividend for 36 consecutive years and maintained dividend payments for 54 years. This is complemented by the company’s moderate level of debt and the ability of its cash flows to sufficiently cover interest payments. For those looking to invest, Chevron’s stock trades with low price volatility, providing a relatively stable investment option.

With the company’s next earnings date on April 26, 2024, investors can anticipate updates on performance and strategy. Chevron’s dividend yield stands at a strong 4.03%, and analysts predict profitability for the year, backed by a profitable track record over the last twelve months.

For those seeking in-depth analysis and additional insights, InvestingPro offers more tips and a fair value estimate of $199.79 for Chevron, higher than current analyst targets. Interested investors can use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, gaining access to a total of 9 InvestingPro Tips for Chevron at https://www.investing.com/pro/CVX.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Sprott announces Q1 2024 dividend of $0.25 per share

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TORONTO – Sprott Inc. (NYSE/TSX: SII), a global leader in precious metals and critical materials investments, has declared a quarterly dividend of US$0.25 per common share for the first quarter of 2024. The dividend is payable on June 5, 2024, to shareholders on record as of May 21, 2024.

The company specified that registered shareholders in Canada, according to Sprott’s shareholder register, as well as beneficial holders with shares held through intermediaries participating in CDS Clearing and Depositary Services Inc. or its nominee, CDS & Co., will receive their dividend in Canadian dollars. The amount will be determined by the spot price exchange rate on the day of payment.

Shareholders residing outside of Canada, including those in the United States, as well as beneficial holders whose intermediary is a participant in The Depository Trust Company or its nominee, Cede & Co., will receive their dividend in U.S. dollars. Beneficial holders with intermediaries in CDS have the option to elect to receive their dividend in U.S. dollars and should contact their broker for more information.

Furthermore, registered shareholders in Canada who are not part of CDS and wish to receive their dividend in U.S. dollars are advised to arrange for their common shares to be deposited with CDS and make a currency election before the May 21, 2024 deadline.

The announced dividend is designated as an eligible dividend for Canadian income tax purposes, which could be advantageous for Canadian taxpayers.

Sprott’s expertise in the precious metals and critical materials sectors is underscored by its specialized investment strategies, which include Exchange Listed Products, Managed Equities, and Private Strategies. With offices located in Toronto, New York, Connecticut, and California, Sprott stands as a specialized entity in its field, differentiating itself from more generalist financial institutions.

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The company’s common shares are traded on both the New York Stock Exchange and the Toronto Stock Exchange under the ticker symbol SII. This dividend announcement is based on a press release statement issued by Sprott Inc.

InvestingPro Insights

Sprott Inc. (NYSE/TSX: SII) has recently announced its quarterly dividend, affirming its commitment to rewarding shareholders. This is in line with one of the InvestingPro Tips that highlights the company’s track record of maintaining dividend payments for 17 consecutive years. Moreover, the same source suggests that Sprott Inc. is trading at a low P/E ratio relative to near-term earnings growth, which could indicate a potential undervaluation of the company’s stock.

Examining the real-time metrics from InvestingPro, Sprott Inc. boasts a market capitalization of $1.04 billion USD, reflecting its substantial presence in the precious metals and critical materials investment sector. The company also shows a promising P/E ratio of 20.75 when adjusted for the last twelve months as of Q4 2023.

This, combined with a PEG ratio of just 0.18 for the same period, suggests that the stock could have room for growth when considering its earnings trajectory. Furthermore, the revenue growth for Sprott Inc. has been robust, with a 16.42% increase over the last twelve months as of Q4 2023, underlining the company’s financial health and potential for further expansion.

For investors interested in deeper insights and additional metrics, there are more InvestingPro Tips available, which could provide a more comprehensive investment picture. To explore these insights and leverage the full suite of tools, consider using the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription at InvestingPro.

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This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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Franklin financial exec Gregory A. Duffey buys $58,000 in stock

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Franklin Financial Services Corp. (NASDAQ:FRAF) director Gregory A. Duffey has recently increased his stake in the company, according to a new SEC filing. On May 3, 2024, Duffey purchased 2,000 shares of common stock at a price of $29.0 per share, totaling $58,000.

This transaction has bolstered Duffey’s ownership in the state commercial bank to 17,964 shares. The purchase reflects a straightforward investment in the company’s stock, without the involvement of equity swaps or other complex financial instruments. As the director of Franklin Financial Services Corp., Duffey’s decision to buy additional shares could be seen as a vote of confidence in the company’s future prospects.

Investors often monitor insider transactions as they may provide insights into the company’s performance and management’s expectations. The details of the transaction, including the number of shares purchased and the price paid, are publicly available through the SEC filing, offering transparency to shareholders and potential investors.

Franklin Financial Services Corp., based in Chambersburg, PA, operates as a state commercial bank and is known for its community-focused banking services. The company’s stock is traded under the ticker symbol FRAF on the NASDAQ exchange.

InvestingPro Insights

Recent insider trading by Franklin Financial Services Corp. (NASDAQ:FRAF) director Gregory A. Duffey has spotlighted the company’s stock, drawing investor attention to its financial health and future outlook. To provide a clearer picture of FRAF’s standing, we’ve gathered some key data and insights from InvestingPro.

Despite a challenging economic environment, Franklin Financial Services Corp. has managed to maintain a consistent dividend payout for 41 consecutive years, a testament to its financial stability and commitment to shareholders. Moreover, the company has experienced a strong return over the last month, with a 12.57% increase, which may partly explain Duffey’s confidence in increasing his stake. This is also reflected in the company’s profitability over the last twelve months, suggesting a solid operational performance.

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InvestingPro Data metrics reveal a market capitalization of $124.48 million and a price-to-earnings (P/E) ratio of 9.05, which adjusts slightly to 9.11 when looking at the last twelve months as of Q1 2024. The company’s price-to-book ratio stands at 0.94 for the same period, indicating that the stock may be reasonably valued in relation to its assets. However, it’s important to note that FRAF suffers from weak gross profit margins, which could be a point of consideration for potential investors.

For those looking to delve deeper into Franklin Financial Services Corp.’s financials and future prospects, InvestingPro offers additional tips and insights. With the use of coupon code PRONEWS24, readers can get an extra 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking even more valuable information. There are 5 more InvestingPro Tips available, which could further guide investment decisions regarding FRAF.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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SICC Co stock rating upgraded to buy, price target cut

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On Tuesday, Jefferies upgraded shares of SICC Co Ltd (688234:CH), a prominent conductive substrate manufacturer, from Hold to Buy, while adjusting the stock price target to RMB66.00 from the previous RMB69.00.

This decision was influenced by the company’s financial performance, with fourth-quarter 2023 and first-quarter 2024 revenues meeting expectations and net profit surpassing both Jefferies’ and consensus estimates.

The optimism for the upgrade is partly due to SICC’s Lingang fabrication plant reaching a capacity of 25 kilowatts per month by the end of 2023. This expansion has positioned SICC among the top three conductive substrate makers.

The analyst noted that overseas customers now contribute approximately 40% to the company’s revenue with a gross margin (GM) of 29% in 2023. The expectation of a higher mix of overseas business in the forthcoming years is a driving factor behind the positive outlook.

The upgrade reflects the company’s short-term financial prospects, which are expected to remain strong. The analyst emphasized this by stating the company’s revenue alignment with forecasts and the substantial outperformance in net profit as key indicators of SICC’s robust financial health.

The revised stock price target of RMB66.00, despite being a slight reduction from the prior target, aligns with the upgraded stock rating and the anticipation of SICC’s continued growth and expansion in market share, especially with its increased capacity and international customer base.

The company’s strategic positioning and financial results are the primary reasons behind Jefferies’ confidence in SICC’s stock performance.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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