Chevron (NYSE:CVX) Trading Up 1.1% - Should You Buy?

Key Points

• Chevron shares rose 1.1% on Wednesday, with trading activity below average as the stock moved between $174.01 and an intraday high of $178.58.
• Recent headlines were mostly supportive: higher oil prices lifted energy stocks, Chevron is reportedly offering chemical technology to help rival drillers boost shale output, and analysts continue to view the stock favorably with a Moderate Buy consensus.
• There are some risks to watch, including a drone attack on a Chevron tanker in the Black Sea and Chevron’s recent removal from the Russell 1000 Dynamic Index, which could affect sentiment and passive fund flows.

Chevron Corporation (NYSE:CVX - Get Free Report) rose 1.1% on Wednesday . The company traded as high as $178.58 and last traded at $175.8940. Approximately 9,896,353 shares traded hands during mid-day trading, a decline of 15% from the average daily volume of 11,647,764 shares. The stock had previously closed at $174.01.

Key Headlines Impacting Chevron

Here are the key news stories impacting Chevron this week:

• Positive Sentiment: Oil prices jumped as the fragile U.S.–Iran ceasefire appeared to unravel, boosting Chevron alongside other major energy stocks because higher crude prices can improve upstream revenue and earnings. Ceasefire Cracks, Oil Bounces: Why Exxon, Chevron Stocks Are Hot Again
• Positive Sentiment: Reuters reported Chevron is offering its chemical technology to rival drillers to help boost shale output, a move that could support future production growth and strengthen its role in U.S. energy supply. Chevron offers rival drillers its chemical technology to boost shale oil output
• Positive Sentiment: Analyst and commentary pieces continue to frame Chevron as an attractive energy and dividend name, with one Yahoo Finance roundup highlighting its sizable upside potential and another citing it among top blue-chip dividend stocks. Here is Why Chevron (CVX) is One of the Most Promising Energy Stocks to Buy Now
• Neutral Sentiment: Chevron was recently removed from the Russell 1000 Dynamic Index, which may create some noise around passive fund flows, but investors appear to be focusing more on oil prices and project fundamentals than the index change. Chevron (CVX) Following Index Removal And Guyana Upgrades, Is The Valuation Case Intact?
• Negative Sentiment: Headline risk remains from the reported drone attack on a Chevron tanker in the Black Sea and from broader geopolitical volatility, which could disrupt logistics or raise operating risk for the company. Chevron tanker used for CPC oil hit by drone in Black Sea

Analyst Upgrades and Downgrades

A number of equities analysts recently commented on the company. BNP Paribas Exane upgraded Chevron from a "neutral" rating to an "outperform" rating and set a $174.00 target price for the company in a report on Friday, April 17th. The Goldman Sachs Group reiterated a "buy" rating and set a $216.00 price target on shares of Chevron in a research note on Wednesday, May 6th. Scotiabank increased their price target on shares of Chevron from $168.00 to $187.00 and gave the stock a "sector perform" rating in a research report on Wednesday, April 22nd. Royal Bank Of Canada reissued an "outperform" rating and issued a $220.00 price objective on shares of Chevron in a research note on Tuesday, May 5th. Finally, Wolfe Research upgraded shares of Chevron from a "peer perform" rating to an "outperform" rating and set a $210.00 price objective for the company in a report on Thursday, July 2nd. Nineteen investment analysts have rated the stock with a Buy rating, six have given a Hold rating and one has assigned a Sell rating to the company's stock. According to data from MarketBeat, Chevron has an average rating of "Moderate Buy" and an average target price of $205.71.

Chevron Price Performance

The company has a market capitalization of $350.31 billion, a PE ratio of 30.48, a price-to-earnings-growth ratio of 0.56 and a beta of 0.50. The company has a debt-to-equity ratio of 0.21, a current ratio of 1.09 and a quick ratio of 0.84. The company's 50 day simple moving average is $182.69 and its 200 day simple moving average is $180.94.

Chevron (NYSE:CVX - Get Free Report) last issued its earnings results on Friday, May 1st. The oil and gas company reported $1.41 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.00 by $0.41. The business had revenue of $47.56 billion during the quarter, compared to analysts' expectations of $51.86 billion. Chevron had a net margin of 5.79% and a return on equity of 6.90%. The company's revenue for the quarter was up 2.1% on a year-over-year basis. During the same quarter in the prior year, the business posted $2.18 EPS. As a group, sell-side analysts predict that Chevron Corporation will post 15.52 earnings per share for the current year.

Chevron Announces Dividend

The business also recently disclosed a quarterly dividend, which was paid on Wednesday, June 10th. Shareholders of record on Tuesday, May 19th were paid a $1.78 dividend. This represents a $7.12 annualized dividend and a yield of 4.0%. The ex-dividend date was Tuesday, May 19th. Chevron's dividend payout ratio is currently 123.40%.

Insider Activity

In other news, Director John B. Hess sold 380,000 shares of Chevron stock in a transaction dated Wednesday, May 20th. The stock was sold at an average price of $193.20, for a total transaction of $73,416,000.00. Following the sale, the director owned 278,045 shares in the company, valued at approximately $53,718,294. The trade was a 57.75% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. Insiders own 0.56% of the company's stock.

Institutional Inflows and Outflows

A number of hedge funds have recently added to or reduced their stakes in the company. Midwest Capital Advisors LLC acquired a new position in shares of Chevron in the 1st quarter valued at $25,000. Core Wealth Advisors LLC acquired a new stake in shares of Chevron during the fourth quarter worth about $26,000. Phillip James Consulting Co. purchased a new position in shares of Chevron during the fourth quarter worth about $26,000. Basso Capital Management L.P. acquired a new position in Chevron in the 4th quarter valued at about $27,000. Finally, Karpus Management Inc. purchased a new stake in Chevron during the 4th quarter valued at approximately $27,000. Hedge funds and other institutional investors own 72.42% of the company's stock.

About Chevron

Chevron Corporation NYSE: CVX is an American multinational energy company engaged in virtually all aspects of the oil and gas industry. As an integrated energy firm, Chevron's core activities include upstream oil and natural gas exploration and production, midstream transportation and storage, downstream refining and marketing of fuels and lubricants, and petrochemical manufacturing through joint ventures and subsidiaries. The company markets fuels under brands such as Chevron, Texaco and Caltex and supplies a range of products and services to retail customers, industrial users and commercial fleets worldwide.

Chevron traces its corporate lineage to the early petroleum companies that eventually became Standard Oil of California and has evolved through significant mergers and restructurings, including the acquisitions of Gulf Oil and Texaco.

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