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Chevron (CVX) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research

Chevron (CVX) closed at $113.26 in the latest trading session, marking a -0.52% move from the prior day. This change lagged the S&P 500's 0.45% loss on the day. Elsewhere, the Dow lost 0.36%, while the tech-heavy Nasdaq lost 0.33%.

Prior to today's trading, shares of the oil company had lost 3.22% over the past month. This has lagged the Oils-Energy sector's gain of 0.95% and the S&P 500's gain of 0.59% in that time.

Wall Street will be looking for positivity from CVX as it approaches its next earnings report date. This is expected to be November 1, 2019. In that report, analysts expect CVX to post earnings of $1.87 per share. This would mark a year-over-year decline of 11.37%. Our most recent consensus estimate is calling for quarterly revenue of $40.77 billion, down 7.31% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $6.78 per share and revenue of $156.69 billion. These totals would mark changes of -17.82% and -5.8%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for CVX. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.88% lower. CVX is currently a Zacks Rank #3 (Hold).

Looking at its valuation, CVX is holding a Forward P/E ratio of 16.79. Its industry sports an average Forward P/E of 11.97, so we one might conclude that CVX is trading at a premium comparatively.

Investors should also note that CVX has a PEG ratio of 4.2 right now. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Oil and Gas - Integrated - International stocks are, on average, holding a PEG ratio of 1.61 based on yesterday's closing prices.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 230, putting it in the bottom 10% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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