2022’s Energy Companies and the Buybacks they’ve been fueling

The logos of six companies (ExxonMobil, Valero, ConocoPhillips, Chevron, Marathon and Phillips) against grey background.

From Russia’s invasion of Ukraine in Feb’22 to inflation rising around the world, 2022 has taken a toll on everyone. But numbers indicate that the Energy sector is not among them. Year-to-date the S&P 500 has declined by 22.96%. Among selected sectors, the Energy industry gave the best results. Year-to-date, the sector value had risen by almost 33.94% whereas all other sectors were in the red zone for the same criteria. 

The numbers ought to be unsurprising for anyone who was following the repurchase announcements thrown by several companies in the Energy field. On October 19, 2022, U.S. President Joe Biden himself quoted, “You should not be using your profits to buy back stock or for dividends. Not now. Not while a war is raging. You should be using these record-breaking profits to increase production and refining.

Here is a table featuring a numerical comparison of six energy companies that announced repurchase programs this year:

Exxon Mobil Corp (XOM: US)

Back in October 2021, Exxon announced a plan to repurchase up to $10 billion worth of shares. However, no shares were actually bought back until Jan’22, for a time period of either 12 or 24 months. Later on April 2022, this program was amended with an additional $20 billion worth of stock. Along with its Q4 2021 and full-year results for 2021, Exxon amended the previous buyback plan leading to a total of $30 billion worth of XOM shares to be acquired, until 2023.

XOM’s stock price soared by 63.35% year-to-date while the company possesses a current Market Cap of approximately $435.9 billion. The Texas-based company works to explore and produce crude oil both domestically and internationally. 

Chevron (CVX: US)

An intention to repurchase $25 billion worth of Chevron’s stock was filed back in February 2019. Until the first quarter of 2022, the company disclosed that it had bought back almost $1.25 billion worth of shares. Stated in its Q2 2022 results report, the company had repurchased almost $2.5 billion worth of CVX shares From January to June 2022. 

Chevron’s stock value has risen by 40.87% year-to-date. Based in California, the company has a present Market Cap of nearly $328.8 billion and works in the production of natural gas and crude oil.

Marathon Petroleum Corp (MPC: US)

On May 14, 2021, Marathon’s board had approved a $7.1 billion share repurchase program. These shares were to be added to the company’s ongoing program of $5 billion worth of shares, approved back in April 2018, and the program had no expiration date. Adding to this, Marathon’s Q2 2022 results reported that the company’s Board had approved a separate $5 billion share repurchase without an expiration date.

High on the ladder, MPC’s stock price surged by 65.81% year-to-date, while the company’s Market Cap is standing at around $55.06 billion. Headquartered in Ohio, Marathon is a downstream energy company and as the name states, it focuses on refining and supplying petroleum products. 

Phillips 66 (PSX: US)

On April 29, 2022, Phillips 66 reported its quarterly earnings for 2022’s first quarter, including buyback plans. The company stressed that it intends to restart its buyback program and then, had a value of $2.5 billion sitting for its upcoming share repurchase plans, without an expiration date. The company had previously halted its repurchase plans in 2020 and since, due to the COVID-19 pandemic so as to preserve as much liquid cash as possible. 

Year-to-date, PSX’s stock values have increased by 29.32%. Also Texas-based like Exxon, Phillips 66 has a current Market Cap of almost $47.6 billion. 

Valero Energy Corp (VLO: US)

As per an SEC filing on July 7, 2022, Valero’s Board approved the repurchase of up to $2.5 billion worth of stock. This program is a continuation of the company’s past buyback programs which were also all to repurchase $2.5 billion worth of shares. The last intention, disclosed on January 23, 2018, was still ongoing as the company’s continued to purchase VLO shares until its completion on June 30, 2022. 

Another company based in Texas, Valero has operated in the manufacturing and marketing of diesel fuels and others since 1980. Since the start of 2022, VLO’s stock price has soared by 61.32% and has a current Market Cap of almost $49.02 billion. 

ConocoPhillips (COP: US)

In a press release dated February 4, 2020, ConocoPhillips disclosed its Q4 and full-year 2019 results, as well as a new repurchase agreement. The company’s then ongoing program to repurchase $25 billion worth of COP shares was upgraded with more shares valued at $10 billion, bringing the net value of shares to be bought to $35 billion. According to a recent SEC filing, ConocoPhillips has repurchased up to $2.3 billion worth of treasury stock in Q2 2022, ending on June 30, 2022. During the second quarter of 2022, the company had reportedly given large returns to shareholders, which included a sum of $2.3 billion through buyback programs.

COP stock’s value surged by 65.12% year-to-date while the company presently has a Market Cap of around $155.1 billion. With headquarters in Texas, ConocoPhillips produces, markets, and distributes crude oil as well as natural gas products.

Inflation and Remaining Repurchase Value

As inflation drives normal citizens to the corner, the world continues to see a huge surge in billionaires. Corporate leaders are uncompromising when it comes to building wealth. According to announcements by the aforementioned companies, the remaining amount yet to be repurchased to fill investor pockets are shown in the table:

Regardless of the severity of current market conditions, these buybacks are a promise to keep company investors on a bull ride.

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