Chevron Overcomes ExxonMobil to Acquire Hess. Which High-Yield Energy Stock Is the Better Buy Now?

Core Insights - The oil and gas industry is experiencing significant mergers, with ExxonMobil acquiring Pioneer Natural Resources and Chevron acquiring Hess, both focusing on offshore oil blocks in Guyana [1][2] - Hess' 30% stake in the Stabroek Block is a key asset, with ExxonMobil holding 45% and CNOOC 25%, making it a valuable partnership for both ExxonMobil and Chevron [4] - The consortium aims to increase production from the Stabroek Block to 1.3 million barrels per day by the end of 2027, having already produced 500 million barrels by November 2024 [5][9] Company Strategies - ExxonMobil has identified Guyana as one of its "advantaged assets," contributing significantly to its production, which was 4.55 million barrels of oil equivalent per day in Q1 2025 [6] - Both ExxonMobil and Chevron have focused on improving production asset quality, reducing break-even levels, and generating positive free cash flow even at low oil prices [11] - ExxonMobil's corporate plan forecasts a break-even Brent crude price of $30 per barrel by 2030, with a projected $165 billion in cumulative surplus operating cash flow at an average Brent price of $65 [12] Financial Performance - Chevron's break-even price is estimated to be in the low $30 range, which, combined with the Hess acquisition, is expected to enhance its production capabilities while maintaining low costs [13] - Both companies have strong dividend histories, with ExxonMobil increasing dividends for 42 consecutive years at a yield of 3.6%, and Chevron for 38 years at a yield of 4.5% [15] - The price-to-earnings ratios for ExxonMobil and Chevron are 14.6 and 17.4 respectively, indicating attractive valuations for value investors [15]