Chevron’s dividend yield
Chevron (CVX) is fifth among the six dividend-yielding stocks discussed in this series. The company’s market cap of ~$227 billion makes it the third-largest company among these stocks.
Currently, Chevron’s dividend yield stands at 4.0%. In the current quarter, Chevron will pay a quarterly dividend of $1.19 per share. Chevron has paid dividends consistently in the past three years. The dividends have risen during this period. Three years ago, Chevron made a quarterly dividend payment of $1.07 per share. Chevron’s stock price has risen 25% in the past three years.
Chevron trades at a forward PE ratio of 17.1x, which is higher than the peer average among the six integrated energy stocks. Chevron also trades at an EV-to-EBITDA multiple of 6.1x, which is above the peer average of 5.8x.
Chevron trades at a premium valuation due to its healthy financials and strong upstream portfolio. Chevron has the second-best debt position in the industry. The company’s cash flow position has strengthened this year.
Chevron saw record upstream production in 2018. Projects like Gorgon and Wheatstone and Permian assets are ramping up production. The company’s output is supposed to rise 4%–7% in 2019.
Chevron has a relatively higher PE ratio with a lower dividend yield. ExxonMobil (XOM) and Suncor Energy (SU) stocks have the same traits. Royal Dutch Shell (RDS.A), BP (BP), and Total (TOT) have lower PE ratios with higher dividend yields.
Next, we’ll discuss Suncor Energy.