California Resources Faces Permit Challenges And Oversupply Risks—Analyst Sees Growth, But Stay Cautious

Group 1 - J.P. Morgan analyst Alejandra Magana maintained a Neutral rating on California Resources Corporation (CRC) with a price forecast of $63 [1] - California Resources reported fourth-quarter 2024 adjusted EPS of$0.91, missing the $0.97 estimate, and revenue of$877 million, falling short of the 897.75 million expectation [1] - The company delivered a strong fourth quarter, with EBITDA beating estimates, solid operations, and continued momentum in CCS volume agreements [1] Group 2 - The company faces challenges maintaining output due to strict California regulations [2] - The Aera acquisition bolstered the business, but concerns remain about oil exposure amid potential oversupply in 2025 [2] - The company's permit inventory rebuild is stalled as CalGEM revises well procedures, and a new bill may allow local governments to impose further restrictions [2] Group 3 - The company is exploring clean power, aiming to connect Elk Hills to a CCS vault [3] - While CRC has unique CCS and power opportunities, regulatory uncertainty and ongoing permitting challenges keep the analyst cautious [3] - Investors can gain exposure to the stock via Invesco S&P SmallCap Energy ETF PSCE and Innovator U.S. Small Cap Managed Floor ETF RFLR [3] Group 4 - CRC shares are up 2.59% at 43.14 at the last check [3]