Contents
TLDR
- Cramer advises maintaining CVX positions, highlighting the 3.85% dividend yield and operational stability
- Latest quarter showed EPS of $1.52, surpassing forecasts by $0.08, while revenue declined 10.2% annually
- Company increased quarterly dividend payment to $1.78 per share, translating to $7.12 annually (~3.8% yield)
- Institutional investors expanded holdings across the board; institutions control 72.42% of shares
- Company insiders liquidated $89.5M in stock during recent quarter; Wall Street consensus remains “Hold” at $176.36 target
Chevron (CVX) has captured significant market attention as shares advanced 1.3% to $186.47 during Friday’s opening bell — approaching the company’s 52-week peak of $187.90.
During a recent broadcast, Jim Cramer advised a viewer to maintain their CVX holdings. “I believe there’s substantial upside potential,” Cramer explained, emphasizing the attractive dividend and Chevron’s track record of reliable performance.
Cramer additionally highlighted potential gains from the company’s Venezuelan operations, characterizing them as an extra catalyst for share appreciation.
Quarterly Payout Receives Boost
Chevron announced an increase to its quarterly distribution, moving from $1.71 to $1.78 per share. This translates to an annual dividend of $7.12 — representing approximately a 3.8% yield. Shareholders on record by February 17 will receive payment on March 10.
The company’s payout ratio currently registers at 106.91%, indicating Chevron is distributing more than its current earnings — a metric investors should monitor closely.
Mixed Results: Revenue Shortfall, Earnings Surpass
Chevron’s latest quarterly filing on January 30 revealed earnings per share of $1.52, exceeding analyst expectations of $1.44. Conversely, revenue totaled $45.79 billion, falling short of the anticipated $48.18 billion and representing a 10.2% year-over-year decline.
The company reported a 6.51% net margin with a 7.89% return on equity. Full-year EPS projections stand at $10.79.
The annual EPS comparison proves concerning — the energy giant delivered $2.06 per share during the comparable period last year.
Institutional Appetite Grows
Numerous institutional investors expanded their CVX allocations during the third quarter. Trivium Point Advisory LLC increased its position by 73.9%, acquiring an additional 6,855 shares for a total of 16,131 valued at approximately $2.5 million.
American Century Companies led institutional buying, adding 810,086 shares — representing a 45.6% expansion — for a cumulative position of 2,586,278 shares worth roughly $401.6 million.
Berkshire Hathaway similarly expanded its Chevron stake following Warren Buffett’s departure from active leadership.
Institutional investors collectively hold 72.42% of outstanding shares.
Insiders Heading for the Exits
While institutional money flows in, company insiders have been exiting. During the previous quarter, insiders sold 534,898 shares totaling $89.5 million.
Vice Chairman Mark A. Nelson disposed of 45,800 shares on February 2 at an average price of $174.17, trimming his holdings by 86.48%. Andrew Benjamin Walz, another insider, sold 1,463 shares on February 18 at $183.83.
Company insiders maintain just 0.21% ownership.
Wall Street’s Perspective
Analyst ratings present a divided picture. UBS maintains a buy recommendation with a $212 price objective. BMO Capital Markets affirmed its outperform rating with a $190 target. JPMorgan elevated CVX from neutral to overweight with a $176 target.
Conversely, one discounted cash flow analysis suggests CVX trades at a 30% premium, placing fair value near $126.
The average rating from 24 analysts settles at “Hold” with a mean price target of $176.36 — beneath current trading levels.
CVX’s 50-day moving average rests at $169.52 while the 200-day stands at $159.57. The energy company commands a $372 billion market capitalization, trades at 28 times earnings, and carries a beta of 0.70.
