Chevron Corp (CVX) said on Wednesday that it intended to invest in Zap Energy Inc, a nuclear fusion start-up company. However, the oil giant did not disclose the size of its investment.
This way Chevron followed the example of Italy’s ENI and Norway’s Equinor, which have also supported nuclear fusion start-ups in an attempt to trim carbon emissions.
Chevron shares closed higher for the sixth time in the past ten trading sessions in New York on Wednesday. The stock went up 1.23% ($1.10) to $90.72, after touching an intraday low at $89.46 and an intraday high at $91.63 respectively.
Shares of Chevron Corp have retreated 24.72% so far in 2020 compared with a 4.63% gain for the benchmark index, S&P 500 (SPX).
In 2019, Chevron’s stock went up 10.77%, thus, it again underperformed the S&P 500, which registered a 28.88% gain.
“Chevron Technology Ventures’ investment in fusion is an opportunity to enhance the company’s focus on a diverse portfolio of low-carbon energy resources,” Chevron Corp said in a statement, cited by Reuters.
The decision comes at a time of mounting investor pressure on energy giants to cut emissions and increase spending on low-carbon energy.
Analyst stock price forecast and recommendation
According to CNN Money, the 21 analysts, offering 12-month forecasts regarding Chevron Corp’s stock price, have a median target of $100.00, with a high estimate of $127.00 and a low estimate of $70.00. The median estimate represents a 10.23% upside compared to the closing price of $90.72 on August 12th.
The same media also reported that at least 15 out of 24 surveyed investment analysts had rated Chevron Corp’s stock as “Buy”, while 6 – as “Hold”. On the other hand, 1 analyst had recommended selling the stock.