Chevron Corp. (NYSE:CVX)

The analysis of the financial ratios over the period from 2020 to 2024 reveals notable trends in operational efficiency, liquidity, leverage, and profitability.

Asset Turnover

Both reported and adjusted total asset turnover ratios show a significant upward trend from 2020 (approximately 0.39-0.40) to a peak in 2022 near 0.90-0.91. This indicates improved efficiency in utilizing assets to generate revenue. However, the ratios decline in 2023 to around 0.75 and stabilize at that level through 2024, suggesting a slight reduction or stabilization in asset utilization efficiency after 2022.

Current Ratio

Liquidity, measured by current ratios, improves from 2020 through 2022, reaching reported and adjusted values of roughly 1.47 and 1.75 respectively, indicating stronger short-term financial health during this period. From 2023 onwards, a decline is observed, with ratios falling to just above 1.0 by 2024, implying a decreasing liquidity cushion but still above the critical threshold of one.

Leverage Ratios (Debt to Equity and Debt to Capital)

Both reported and adjusted debt to equity and debt to capital ratios decrease consistently from 2020 to 2023, indicating a reduction in financial leverage and reliance on debt financing. Debt to equity falls from around 0.34 to as low as 0.13-0.14 by 2023, before a slight increase in 2024. Debt to capital follows a similar pattern, reaching lows near 0.11-0.12 in 2023 before a minor uptick in the final year.

Financial Leverage

The reported and adjusted financial leverage ratios demonstrate a gradual decline from 2020 to 2022, reflecting decreased use of debt in capital structure. The ratios slightly increase from 2023 to 2024 but remain below earlier levels, suggesting a cautiously higher leverage but still moderate relative to 2020.

Profitability Metrics (Net Profit Margin, ROE, ROA)

Profitability shows a marked recovery post-2020, where negative net profit margins and returns indicate losses. From 2021 onward, net profit margin improves substantially, peaking in 2022 with reported and adjusted margins above 15% and 17% respectively. Subsequent declines in 2023 occur, with margins remaining positive but lower, stabilizing around 9-10% in 2024.

Return on equity (ROE) follows a similar trajectory, moving from negative returns in 2020 to peak positive performance in 2022 (over 22-23%), with a decline thereafter yet maintaining double-digit positive performance through 2024.

Return on assets (ROA) mirrors this trend, showing substantial improvement from losses in 2020 to a high in 2022 (approximately 14-16%), followed by lower but positive returns in the later years.

In summary, the company exhibited strong operational improvements and profitability growth from 2020 through 2022, supported by increasing asset turnover and reducing leverage. However, 2023 and 2024 reflect a moderation in these improvements with stabilized asset turnover, some erosion in liquidity, slight increases in leverage, and reduced but positive profitability. These trends suggest a phase of consolidation or adjustment following a period of robust expansion and financial strengthening.

Sales and other operating revenues

The sales and other operating revenues showed a significant increase from 94,471 million US dollars in 2020 to a peak of 235,717 million US dollars in 2022. However, this was followed by a decline over the next two years, dropping to 196,913 million in 2023 and further to 193,414 million in 2024. Despite this recent decrease, the revenues in 2024 remain substantially higher than those in 2020, indicating overall growth over the five-year period.

Total assets

Total assets exhibited a modest increase during the period. The value was 239,790 million US dollars at the end of 2020 and remained almost unchanged in 2021 at 239,535 million. It then grew steadily to 261,632 million in 2023 before slightly declining to 256,938 million in 2024. This suggests a relatively stable asset base with minor fluctuations towards the end of the period.

Reported total asset turnover

The reported total asset turnover ratio demonstrated a notable upward trend from 0.39 in 2020 to 0.91 in 2022, indicating improved efficiency in generating sales from assets. However, in 2023 and 2024, the ratio decreased and stabilized at 0.75, which, while lower than the peak, still reflects an improvement compared to 2020 levels.

Adjusted total assets

Adjusted total assets followed a pattern similar to total assets, with values increasing from 237,537 million US dollars in 2020 to 264,219 million in 2023, before declining slightly to 259,678 million in 2024. This confirms a generally stable and growing asset base after adjustments, with slight decreases in the final year.

Adjusted total asset turnover

The adjusted total asset turnover mirrored the reported ratio, increasing from 0.40 in 2020 to 0.90 in 2022. It then decreased to 0.75 in 2023 and slightly dropped to 0.74 in 2024. This pattern highlights a peak in asset utilization efficiency in 2022, with a decline but sustained better performance relative to initial levels in the following years.

The financial data reveals several patterns and shifts in liquidity over the five-year period from 2020 to 2024.

Current Assets

The current assets exhibited an overall upward trend from 2020 through 2022, rising from 26,078 million US dollars in 2020 to a peak of 50,343 million US dollars in 2022. However, after that peak, there was a decline in 2023 to 41,128 million US dollars, which remained almost stable but slightly decreased further to 40,911 million US dollars in 2024.

Current Liabilities

The current liabilities increased consistently throughout the period, starting at 22,183 million US dollars in 2020 and reaching 38,558 million US dollars by 2024. Notably, the most considerable increase occurred between 2023 and 2024.

Reported Current Ratio

The reported current ratio improved from 1.18 in 2020 to a high point of 1.47 in 2022, indicating improved short-term liquidity through that time. Nonetheless, in the years following, the ratio declined to 1.27 in 2023 and further to 1.06 in 2024. The decline reflects that current liabilities have increased faster than current assets in the latter years, reducing short-term solvency.

Adjusted Current Assets

Adjusted current assets followed a similar pattern to reported current assets but at a higher level. They rose significantly from 29,111 million US dollars in 2020 to 59,861 million US dollars in 2022. Similar to the reported figures, adjusted assets then fell to 47,884 million US dollars in 2023 and further to 47,167 million US dollars in 2024.

Adjusted Current Ratio

The adjusted current ratio, which presumably accounts for certain asset or liability adjustments, increased from 1.31 in 2020 to a peak of 1.75 in 2022. Subsequently, it declined to 1.48 in 2023 and further to 1.22 in 2024. Despite this decrease, the adjusted ratio remains above 1 in 2024, indicating adequate liquidity when adjusted.

In summary, the company experienced a notable improvement in liquidity up to 2022, reflected in rising current assets and favorable current ratios. However, starting in 2023, the data indicates a contraction in current assets and a sharper increase in current liabilities, resulting in declining liquidity ratios. Although adjusted measures show a healthier liquidity position than the reported ratios, the downward trend in both reported and adjusted ratios in the last two years suggests increasing pressure on short-term financial stability.

Total Debt

The total debt of the company exhibited a consistent downward trend from 44,315 million US dollars in 2020 to 20,836 million in 2023. However, in 2024, a slight reversal occurred with an increase to 24,541 million US dollars.

Total Chevron Corporation Stockholders’ Equity

Stockholders’ equity showed steady growth from 131,688 million US dollars in 2020, peaking at 160,957 million in 2023, followed by a minor decline to 152,318 million in 2024. Overall, equity rose significantly over the five-year period.

Reported Debt to Equity Ratio

The reported debt to equity ratio declined considerably from 0.34 in 2020 to 0.13 in 2023, indicating improved leverage and reduced relative debt burden. This ratio slightly increased to 0.16 in 2024, reflecting the increase in debt and decrease in equity observed that year.

Adjusted Total Debt

Adjusted total debt followed a parallel pattern to total debt, decreasing from 48,221 million US dollars in 2020 to 26,070 million in 2023, before increasing to 29,611 million in 2024. The adjusted figures are consistently higher than the reported total debt values, reflecting potential additional liabilities or adjustments.

Adjusted Total Equity

Adjusted total equity increased steadily from 143,512 million in 2020 to a peak of 183,352 million in 2023, then declined slightly to 176,024 million in 2024. The adjusted equity figures are higher than the reported equity, indicating possible inclusion of comprehensive income or other adjustments.

Adjusted Debt to Equity Ratio

This ratio decreased from 0.34 in 2020 to 0.14 in 2023, mirroring the trend seen in the reported debt to equity. A rise to 0.17 in 2024 occurred, consistent with the observed increase in adjusted debt and slight reduction in adjusted equity during that year.

Summary of Trends

Overall, the data indicates a strong deleveraging trend from 2020 through 2023, with both reported and adjusted debt levels significantly reduced. Equity levels improved steadily over this period, resulting in declining debt-to-equity ratios and a strengthened financial position. The year 2024 shows early signs of a reversal with increased debt and marginally decreased equity, leading to a modest rise in leverage ratios. This may warrant further monitoring to determine if this trend continues or is a temporary fluctuation.

Total Debt

The total debt shows a significant decrease from 44,315 million USD in 2020 to 20,836 million USD in 2023. However, in 2024, there is a reversal in this trend, with total debt increasing to 24,541 million USD. This suggests an overall reduction in leverage over the period, with a recent uptick possibly indicating new borrowing or changes in financing strategy.

Total Capital

Total capital exhibits slight fluctuations throughout the period. Starting at 176,003 million USD in 2020, it dips marginally in 2021, then rises to a peak of 182,621 million USD in 2022 before stabilizing around 181,793 million in 2023 and decreasing slightly in 2024 to 176,859 million USD. This indicates relatively stable capitalization with minor year-to-year changes.

Reported Debt to Capital Ratio

The reported debt to capital ratio declines steadily from 0.25 in 2020 to a low of 0.11 in 2023, reflecting a reduced reliance on debt financing in relation to the overall capital structure. Nevertheless, the ratio increases slightly to 0.14 in 2024, corresponding with the increase in total debt during the same year, suggesting a moderate increase in leverage.

Adjusted Total Debt

Adjusted total debt follows a decreasing trend from 48,221 million USD in 2020 down to 26,070 million USD in 2023. Similar to total debt, it experiences a rise in 2024, reaching 29,611 million USD. This trend mirrors the movements in total debt, reinforcing the observation of reduced leverage over multiple years followed by a more recent increase.

Adjusted Total Capital

Adjusted total capital increases from 191,733 million USD in 2020 to a peak of 209,767 million USD in 2022, remaining relatively stable near this level through 2023 and slightly decreasing to 205,635 million USD in 2024. This pattern indicates an overall strengthening of capital base over the earlier years, with recent years showing stabilization.

Adjusted Debt to Capital Ratio

The adjusted debt to capital ratio decreases from 0.25 in 2020 to 0.12 in 2023, highlighting improved capital structure with lower adjusted leverage. The ratio then rises to 0.14 in 2024, consistent with the increase in adjusted debt observed, signaling a modest increase in adjusted leverage.

The financial data reveals several important trends over the five-year period under review. Total assets demonstrate a generally upward trajectory from 2020 to 2023, rising from approximately 239.8 billion to 261.6 billion US dollars, followed by a slight decline in 2024 to around 256.9 billion. This indicates an expansion phase for most of the period, with a marginal contraction towards the end.

Stockholders’ equity follows a similar upward pattern, increasing from about 131.7 billion US dollars in 2020 to a peak near 161.0 billion in 2023, before declining to 152.3 billion in 2024. This fluctuation suggests that the company was able to grow its equity base substantially before encountering a reduction, which might be attributable to changes in retained earnings, dividends, or other equity adjustments.

When examining financial leverage, the reported financial leverage ratio declines consistently from 1.82 in 2020 to 1.62 in 2022, then slightly rises again to 1.69 by 2024. This pattern highlights a trend towards lower leverage up to 2022—potentially indicating a strengthening equity position or deleveraging efforts—followed by a moderate increase in leverage more recently.

Looking at the adjusted figures, adjusted total assets mirror the trajectory of total assets, with growth from about 237.5 billion to 264.2 billion between 2020 and 2023 and a slight decrease in 2024. Adjusted total equity shows an increasing trend more pronounced than the reported equity, rising from approximately 143.5 billion in 2020 to a peak of 183.4 billion by 2023, before reducing to 176.0 billion in 2024. This suggests that adjustments reflect a more optimistic equity position over most periods.

The adjusted financial leverage ratio declines steadily from 1.66 in 2020 to 1.44 in 2022 and remains stable into 2023 before a moderate increase to 1.48 by 2024. This indicates sustained efforts to lower leverage over several years, with a slight reversal more recently, consistent with the reported leverage trends but at lower levels.

Total Assets

Generally increasing over the period with a peak in 2023, followed by a minor decrease in 2024.

Stockholders’ Equity

Significant growth through 2023, then a noticeable decline in 2024, indicating variability in equity components.

Reported Financial Leverage

Declining trend until 2022, followed by a modest rise, reflecting changes in debt relative to equity.

Adjusted Total Assets and Equity

Both show growth trends similar to reported values but highlight a stronger equity increase.

Adjusted Financial Leverage

Decreased steadily until 2023, with a slight increase in 2024, indicating improved capital structure stability overall.

Net Income (Loss) Attributable to Chevron Corporation

The net income showed significant volatility over the observed period. It started with a substantial loss of -5,543 million USD in 2020, followed by a marked recovery to profits of 15,625 million USD in 2021. This positive momentum accelerated in 2022, reaching a peak of 35,465 million USD. However, subsequent years saw declines to 21,369 million USD in 2023 and further down to 17,661 million USD in 2024, indicating a diminishing profitability trend after 2022.

Sales and Other Operating Revenues

Sales and operating revenues exhibited strong growth from 94,471 million USD in 2020 to a peak of 235,717 million USD in 2022. This doubling suggests robust revenue expansion during this period. Despite this, revenues declined notably in 2023 to 196,913 million USD and slightly further to 193,414 million USD in 2024, which may reflect either market challenges or operational constraints impacting revenue generation.

Reported Net Profit Margin

The reported net profit margin shifted substantially from a negative margin of -5.87% in 2020 to a positive 10.04% in 2021, peaking at 15.05% in 2022. Following the peak, the margin decreased to 10.85% in 2023 and further to 9.13% in 2024, consistent with the declining net income trend and signifying reduced efficiency or margin compression in the latter years.

Adjusted Net Income (Loss)

Adjusted net income followed a similar pattern to the reported net income, beginning with a larger loss of -11,554 million USD in 2020, then increasing markedly to 20,543 million USD in 2021 and peaking at 42,417 million USD in 2022. However, a sharp reduction occurred in 2023 to 18,804 million USD, with a slight recovery to 19,673 million USD in 2024. This suggests substantial adjustment items affecting net income, but the overall trend mirrors reported earnings.

Adjusted Net Profit Margin

The adjusted net profit margin improved from -12.23% in 2020 to a high of 17.99% in 2022, showing strong operational profitability once adjustments are considered. However, a notable decline ensued to 9.55% in 2023, followed by a modest increase to 10.17% in 2024. This pattern indicates some stabilization in profitability after the sharp decline, but still below peak levels.

Overall Analysis

The data reveals a recovery and growth phase from 2020 through 2022, where net income, adjusted net income, sales, and profit margins all improved significantly. This was followed by a period of contraction or consolidation in 2023 and 2024, where both revenue and profitability metrics declined from their peak but remained positive and elevated compared to the initial year. The reduced margins and income in the later years suggest challenges impacting profitability and revenue growth, warranting further investigation into underlying causes such as market conditions, cost structure changes, or external economic factors.

Net income (loss) attributable to Chevron Corporation

The net income showed significant fluctuations over the period. A substantial loss of -5543 million USD was recorded in 2020, followed by a sharp recovery in 2021 with a positive net income of 15625 million USD. The upward trend continued strongly into 2022, reaching a peak of 35465 million USD. However, net income declined in 2023 and 2024, decreasing to 21369 million USD and 17661 million USD respectively, indicating volatility after the peak year.

Total Chevron Corporation stockholders’ equity

Stockholders' equity exhibited a steady increase from 131688 million USD in 2020 to 160957 million USD in 2023. In 2024, there was a slight decline to 152318 million USD. Overall, equity growth was positive but showed a minor contraction at the end of the period.

Reported Return on Equity (ROE)

Reported ROE reflected the net income trends with an initial negative figure of -4.21% in 2020, turning positive at 11.24% in 2021. It peaked at 22.27% in 2022 before decreasing to 13.28% in 2023 and further to 11.59% in 2024. This pattern indicates strong profitability improvement followed by moderation in return efficiency.

Adjusted net income (loss)

Adjusted net income followed a trend similar to reported net income but with more pronounced losses and gains. It started with a larger loss of -11554 million USD in 2020, increased significantly to 20543 million USD in 2021, and peaked at 42417 million USD in 2022. Afterward, adjusted net income declined to 18804 million USD in 2023 but slightly increased to 19673 million USD in 2024.

Adjusted total equity

Adjusted total equity steadily increased each year from 143512 million USD in 2020 to 183352 million USD in 2023, with a minor decrease to 176024 million USD in 2024. This trend is consistent with the reported equity movement but shows a slightly higher base and peak.

Adjusted Return on Equity (ROE)

The adjusted ROE started at a negative -8.05% in 2020, then rose sharply to 13.26% in 2021 and reached a high of 23.26% in 2022, closely mirroring the adjusted net income trend. It experienced a notable decline to 10.26% in 2023, followed by a slight recovery to 11.18% in 2024, indicating some stabilization after a period of volatility.

Net Income (Loss) Attributable to Chevron Corporation

The net income exhibited significant volatility over the five-year period. Initially, there was a considerable loss of $5,543 million in 2020, followed by a sharp recovery with a positive income of $15,625 million in 2021. The upward trend continued strongly in 2022, reaching a peak net income of $35,465 million. However, the net income declined in both 2023 and 2024 to $21,369 million and $17,661 million respectively, indicating some contraction after the peak year.

Total Assets

Total assets showed a generally increasing pattern from 2020 to 2023, rising from $239,790 million to $261,632 million. A slight decrease occurred in 2024, bringing the total assets to $256,938 million, which still remains above the initial 2020 level. This overall growth suggests ongoing asset accumulation with a minor contraction or revaluation at the end of the period.

Reported Return on Assets (ROA)

The reported ROA transitioned from negative in 2020 (-2.31%) to positive levels thereafter. It peaked at 13.76% in 2022, consistent with the peak in net income. This metric then declined to 8.17% in 2023 and further to 6.87% in 2024, mirroring the reduction in net income within those years. The pattern indicates improved asset profitability following the loss year, with a subsequent moderation.

Adjusted Net Income (Loss)

Adjusted net income displays a broadly similar trend to reported net income but with higher magnitude variations. It started with a larger loss of $11,554 million in 2020, surged to a gain of $20,543 million in 2021, and peaked substantially at $42,417 million in 2022. Unlike reported net income, adjusted figures rebounded slightly in 2024 at $19,673 million after a decrease in 2023 to $18,804 million, indicating somewhat more stability in adjusted profitability metrics.

Adjusted Total Assets

Adjusted total assets followed a steady upward trend from $237,537 million in 2020 to $264,219 million in 2023. In 2024, adjusted total assets decreased slightly to $259,678 million. The trend aligns closely with reported total assets, reflecting consistent asset base growth and a minor easing in the latest year.

Adjusted Return on Assets (ROA)

Adjusted ROA improved markedly from a negative return of -4.86% in 2020 to a high of 16.15% in 2022, demonstrating a strong enhancement in asset profitability when adjustments are considered. The ratio declined to 7.12% in 2023 but showed a modest recovery to 7.58% in 2024, indicating improved efficiency relative to unadjusted ROA during the later years.