The Bull Case For California Resources (CRC) Could Change Following New Focus On Carbon Capture Economics

• California Resources Corporation recently presented at the Clean Gulf Conference in New Orleans, where Manager Mike Drieu outlined the company’s emergency preparedness and response initiatives for health, safety, and environmental risks.
• At the same time, new analyst coverage has drawn attention to California Resources’ power and carbon capture businesses, underscoring its efforts to build revenue streams beyond traditional oil production.
• We’ll now consider how Wells Fargo’s focus on California Resources’ carbon capture and power operations may influence the stock’s existing investment narrative.

Trump has pledged to "unleash" American oil and gas and these 22 US stocks have developments that are poised to benefit.

California Resources Investment Narrative Recap

To own California Resources, you need to believe it can balance a mature oil base with emerging carbon capture and power opportunities in a heavily regulated state. Wells Fargo’s focus on these newer businesses supports that long term narrative, but it does not materially change the near term picture, where permitting uncertainty in California remains a key risk and progress on carbon capture approvals is still the most important catalyst to watch.

The recent Wells Fargo initiation, which separately values California Resources’ power and CCUS operations, ties directly into that carbon capture catalyst by putting more investor attention on these projects. This follows a mixed earnings backdrop, where the latest quarter beat profit expectations despite weaker revenue, reinforcing the idea that any future re rating may depend less on short term oil output and more on how quickly the company can turn its low carbon projects into meaningful contributors.

Yet while the upside from these projects is appealing, investors should also be aware that delays in critical CCS permits could...

Read the full narrative on California Resources (it's free!)

California Resources' narrative projects $3.0 billion revenue and $161.5 million earnings by 2028. This implies revenue declining by 5.9% per year and an earnings decrease of $503.5 million from $665.0 million today.

Uncover how California Resources' forecasts yield a $65.64 fair value, a 38% upside to its current price.

Exploring Other Perspectives

Two Simply Wall St Community valuations for California Resources cluster between US$65.64 and US$120.28 per share, highlighting how far apart individual views can be. Against that wide spread, the reliance on timely regulatory approvals for both oil permits and CCS projects may prove to be a key factor in how the company’s actual performance compares with these expectations.

Explore 2 other fair value estimates on California Resources - why the stock might be worth just $65.64!

Build Your Own California Resources Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your California Resources research is our analysis highlighting 3 key rewards and 2 important warning signs that could impact your investment decision.
• Our free California Resources research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate California Resources' overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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