Chevron Corporation (NYSE:CVX) Is A Real Dividend Rock Star – Here Is Why
If you are an income investor, then Chevron Corporation (NYSE:CVX) should be on your radar. Chevron Corporation, through its subsidiaries, engages in integrated energy, chemicals, and petroleum operations worldwide. Over the past 10 years, the US$213.74B market cap company has been growing its dividend payments, from $2.32 to $4.48. Currently yielding 4.00%, let’s take a closer look at Chevron’s dividend profile. Check out our latest analysis for Chevron
What Is A Dividend Rock Star?
It is a stock that pays a stable and consistent dividend, having done so reliably for the past decade with the expectation of this continuing into the future. More specifically: Its annual yield is among the top 25% of dividend payers It has paid dividend every year without dramatically reducing payout in the past Its has increased its dividend per share amount over the past It can afford to pay the current rate of dividends from its earnings It is able to continue to payout at the current rate in the future
High Yield And Dependable
Chevron currently yields 4.00%, which is on the low-side for Oil and Gas stocks. But the real reason Chevron stands out is because it has a proven track record of continuously paying out this level of dividends, from earnings, to shareholders and can be expected to continue paying in the future. This is a highly desirable trait for a stock holding if you’re investor who wants a robust cash inflow from your portfolio over a long period of time.
If there is one thing that you want to be reliable in your life, it’s dividend stocks and their constant income stream. CVX has increased its DPS from $2.32 to $4.48 in the past 10 years. It has also been paying out dividend consistently during this time, as you’d expect for a company increasing its dividend levels. This is an impressive feat, which makes CVX a true dividend rockstar. The current trailing twelve-month payout ratio for the stock is 88.46%, which means that the dividend is covered by earnings. In the near future, analysts are predicting lower payout ratio of 67.13%, leading to a dividend yield of 4.10%. However, EPS should increase to $6.18, meaning that the lower payout ratio does not necessarily implicate a lower dividend payment.
Next Steps:
With Chevron producing strong dividend income for your portfolio over the past few years, you can take comfort in knowing that this stock will still continue to be a top dividend generator moving forward. However, given this is purely a dividend analysis, you should always research extensively before deciding whether or not a stock is an appropriate investment for you. I always recommend analysing the company’s fundamentals and underlying business before making an investment decision. Below, I’ve compiled three essential aspects you should look at:
1. Future Outlook: What are well-informed industry analysts predicting for CVX’s future growth? Take a look at our free research report of analyst consensus for CVX’s outlook.
2. Valuation: What is CVX worth today? Even if the stock is a cash cow, it’s not worth an infinite price. The intrinsic value infographic in our free research report helps visualize whether CVX is currently mispriced by the market.
3. Other Dividend Rockstars: Are there strong dividend payers with better fundamentals out there? Check out our free list of these great stocks here.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
