California Resources Corporation (CRC) | Investment Case

1. Company Snapshot

1.a. Company Description

California Resources Corporation operates as an independent oil and natural gas company.The company explores for, produces, gathers, processes, and markets crude oil, natural gas, and natural gas liquids for marketers, California refineries, and other purchasers that have access to transportation and storage facilities.As of December 31, 2021, it had interests in approximately 1.9 million net mineral acres with proved reserves totaled an estimated 480 million barrels of oil equivalent.

The company also engages in the generation and sale of electricity to the local utility and the grid.The company was incorporated in 2014 and is based in Santa Clarita, California.

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1.b. Last Insights on CRC

California Resources Corporation's recent performance has been positively driven by several factors. The company's closing of its all-stock combination with Berry Corporation in December 2025, has expanded its asset base, increased synergies, and enhanced cash flow durability. Additionally, CRC's carbon and power deals, including a 3MMT CO2 pact, have boosted diversification ahead of key 2026 project milestones. Institutional investors, such as Principal Financial Group Inc., have also shown confidence in the company, with Principal Financial Group Inc. acquiring an additional 90,466 shares, representing a 23.9% increase in its stake.

1.c. Company Highlights

Last Price	61.79
Change Percentage	0.12%
Open	61.73
Previous Close	61.72
Market Cap ( Millions)	5474
Volume	526918
Year High	66.35
Year Low	30.97
M A 50	53.81
M A 200	49.65

FCF Yield	9.92%
Dividend Yield	2.57%
ROE	10.34%
Debt / Equity	36.99%
Net Debt / EBIDTA	91.57%
Price To Book	1.46
Price Earnings Ratio	14.81
Price To FCF	10.08
Price To sales	1.57
EV / EBITDA	5.0

2. California Resources Corporation's Strong 2025 Results and Promising Outlook

California Resources Corporation (CRC) reported a robust financial performance for 2025, with adjusted EBITDAX reaching nearly $1.25 billion and free cash flow of $543 million, the highest level since 2021. The company's revenue growth was in line with analysts' expectations, although the actual EPS came in slightly lower at $0.47 compared to estimates of $0.49. CRC's high-quality, low-decline conventional assets generated stable cash flow, supporting annual capital returns while maintaining balance sheet strength.

Publication Date: Mar -03

                                    📋 Highlights
                                    Record Shareholder Returns::
                                                Returned $1.6B to shareholders since 2021, including $543M FCF in 2025.
2P Reserve Depth::
                                                Expanded 2P reserves to 1.2B Boe, supporting 20+ years of development at current production rates.
Carbon Capture Progress::
                                                Completed California’s first commercial-scale CCS project at Elk Hills, awaiting EPA approval for CO2 injection.
Cost Efficiency::
                                                Achieved $300M in structural cost reductions since 2023, targeting $450M cumulative savings by 2028.

                                

Operational Highlights and Guidance

CRC grew production for the third consecutive year and delivered record financial performance, even as commodity prices declined 14% year-over-year. The company's guidance indicates further annual production growth in 2026, with a capital program designed to materially reduce the corporate decline rate to roughly 2%. CRC's expanded 2P disclosure of nearly 1.2 billion Boe highlights the depth and longevity of its inventory, supporting 20-plus years of development at current production levels. As Clio Crespy mentioned, "We're delivering on our financial and operational targets, while further strengthening the durability of our business."

Carbon Management and Power Platforms

CRC is making significant progress in its carbon management and power platforms. The company has successfully captured CO2 from its gas processing plant and is awaiting final EPA approval to commence injection at its Elk Hills carbon capture and storage (CCS) project. CRC is also exploring opportunities in the power sector, with a "Power Now" concept that allows customers to scale their power needs. The company's integrated strategy continues to differentiate CRC, with a focus on high-return oil and gas developments and capital-efficient advancement of its carbon management and power platforms.

Valuation and Outlook

With a P/E Ratio of 13.49 and an EV/EBITDA of 4.16, CRC's valuation appears reasonable compared to its peers. The company's dividend yield of 2.55% and free cash flow yield of 12.05% are also attractive. Analysts estimate revenue growth of 4.6% for the next year, indicating a positive outlook. CRC's strong financial performance, operational highlights, and promising guidance suggest that the company is well-positioned for long-term value creation.

3. NewsRoom

California Resources Corporation Announces Pricing of Upsized Private Offering of $350 Million of Additional 7.000% Senior Unsecured Notes due 2034

Mar -11

Source: globenewswire.com

California Resources Corporation Announces Private Offering of Additional 7.000% Senior Unsecured Notes due 2034

Mar -11

Source: globenewswire.com

Fieldview Capital Management LLC Trims Stock Holdings in California Resources Corporation $CRC

Mar -11

Source: defenseworld.net

California Resources' Lofty Share Price Is Justified

Mar -03

Source: seekingalpha.com

California Resources Corporation (CRC) Q4 2025 Earnings Call Transcript

Mar -02

Source: seekingalpha.com

California Resources Corporation (CRC) Q4 Earnings Lag Estimates

Mar -02

Source: zacks.com

California Resources Corporation Reports Fourth Quarter and Full-Year 2025 Financial and Operating Results; Announces 2026 Guidance

Mar -02

Source: globenewswire.com

Carbon TerraVault Provides 2025 Update

Mar -02

Source: globenewswire.com

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.62%)

6. Segments

Oil

Expected Growth: 5%

California Resources Corporation's 5% growth in oil production is driven by increased drilling activities in the San Joaquin Basin, improved well completion techniques, and enhanced oil recovery methods. Additionally, the company's focus on cost reduction and operational efficiencies has also contributed to the growth.

Natural Gas

Expected Growth: 4%

California Resources Corporation's 4% growth in natural gas is driven by increasing demand from power generation and industrial sectors, coupled with rising production from existing assets and strategic acquisitions. Additionally, favorable state regulations and growing exports to Mexico contribute to the growth.

Natural Gas Liquids

Expected Growth: 3%

California Resources Corporation's Natural Gas Liquids segment growth is driven by increasing demand for clean energy, strategic acquisitions, and optimized operations. Additionally, the company's focus on enhancing drilling and completion techniques, coupled with favorable geology in California, contributes to the 3% growth rate.

7. Detailed Products

Crude Oil

California Resources Corporation is a leading producer of crude oil, which is used as a primary energy source for transportation, industrial processes, and power generation.

Natural Gas

California Resources Corporation produces natural gas, a clean-burning fuel used for electricity generation, heating, and industrial processes.

Natural Gas Liquids (NGLs)

California Resources Corporation extracts NGLs, which are used as feedstocks for petrochemicals, fuels, and other products.

Electricity

California Resources Corporation generates electricity through its power plants, which use natural gas and other fuels to produce electricity.

8. California Resources Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

California Resources Corporation operates in the energy industry, which has a moderate threat of substitutes. While there are alternative energy sources, the company's focus on oil and gas production reduces the threat of substitutes.

Bargaining Power Of Customers

California Resources Corporation's customers, primarily refineries and petrochemical companies, have limited bargaining power due to the company's significant market share and diversified customer base.

Bargaining Power Of Suppliers

The company's suppliers, including drilling and extraction service providers, have moderate bargaining power due to the availability of alternative suppliers and the company's significant purchasing power.

Threat Of New Entrants

The threat of new entrants is low due to the high barriers to entry in the energy industry, including significant capital requirements and regulatory hurdles.

Intensity Of Rivalry

The energy industry is highly competitive, with several major players competing for market share. California Resources Corporation faces intense rivalry from other oil and gas producers, which can lead to pricing pressure and reduced market share.

9. SWOT Analysis

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

	Value
Debt Weight	20.01%
Debt Cost	11.37%
Equity Weight	79.99%
Equity Cost	11.37%
WACC	11.37%
Leverage	25.01%

11. Quality Control: California Resources Corporation passed 3 out of 9 key points

Strong Liquidity

Low Debt

Strong Interest Coverage

Healthy Cash Flow

Operating Efficiency

Strong Return On Equity

Consistent Revenue Growth

Consistent Operating Cash Flow Growth

Margin Improvement

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

California Resources

A-Score: 5.9/10

Value: 8.4

Growth: 3.3

Quality: 7.7

Yield: 6.0

Momentum: 4.0

Volatility: 5.7

1-Year Total Return ->

SM Energy

A-Score: 5.2/10

Value: 9.6

Growth: 5.7

Quality: 6.6

Yield: 5.0

Momentum: 0.5

Volatility: 3.7

1-Year Total Return ->

Crescent Energy

A-Score: 5.2/10

Value: 7.5

Growth: 4.2

Quality: 5.0

Yield: 9.0

Momentum: 1.5

Volatility: 3.7

1-Year Total Return ->

Marathon Oil

A-Score: 4.6/10

Value: 4.7

Growth: 6.3

Quality: 6.5

Yield: 1.0

Momentum: 6.0

Volatility: 3.0

1-Year Total Return ->

CNX Resources

A-Score: 4.5/10

Value: 6.5

Growth: 3.1

Quality: 5.2

Yield: 0.0

Momentum: 5.0

Volatility: 7.0

1-Year Total Return ->

Kosmos Energy

A-Score: 3.3/10

Value: 9.8

Growth: 5.2

Quality: 3.1

Yield: 0.0

Momentum: 0.0

Volatility: 2.0

1-Year Total Return ->

Peers Metrics

12.e Scoring ^Insights

12.f DCF ^BETA

Parameters

Short Term Growth

1.95%

Short term Time

10.0

Long-Term Growth

2.00%

WACC

11.37%

California Resources Corporation - US13057Q3056

1. Company Snapshot

1.a. Company Description

1.b. Last Insights on CRC

1.c. Company Highlights

Average Growth

Average Quality

Stable Momentum

Earnings Beats

Revenues Beats

Fairly Valued

Lower Growth

Earnings Miss

Average Yield

Better Quality

Revenues Miss

2. California Resources Corporation's Strong 2025 Results and Promising Outlook

Operational Highlights and Guidance

Carbon Management and Power Platforms

Valuation and Outlook

3. NewsRoom

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (4.62%)

6. Segments

Oil

Expected Growth: 5%

Natural Gas

Expected Growth: 4%

Natural Gas Liquids

Expected Growth: 3%

7. Detailed Products

Crude Oil

Natural Gas

Natural Gas Liquids (NGLs)

Electricity

8. California Resources Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

Bargaining Power Of Customers

Bargaining Power Of Suppliers

Threat Of New Entrants

Intensity Of Rivalry

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

11. Quality Control: California Resources Corporation passed 3 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

61.79$

Current Price

61.79$

Potential

-0.00%

Expected Cash-Flows

12.e Scoring ^Insights

12.f DCF ^BETA