TLDR
- Cramer advises maintaining CVX positions, highlighting the 3.85% dividend and company’s reliable performance
- Latest quarter showed EPS of $1.52, exceeding forecasts by $0.08, while revenue declined 10.2% versus prior year
- Company boosted quarterly payout to $1.78 per share, translating to $7.12 annually (~3.8% yield)
- Institutional investors expanded holdings; institutions control 72.42% of outstanding shares
- Company executives offloaded $89.5M in shares 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 at Friday’s open — hovering close to the 52-week peak of $187.90.
During a recent broadcast, Jim Cramer shared his perspective with a viewer, recommending they maintain their position. “I think it can go up a lot,” Cramer stated, emphasizing the dividend return and Chevron’s track record of “consistency.”
Cramer also highlighted potential gains from the company’s Venezuelan assets, characterizing them as an additional catalyst for upward momentum.
Quarterly Payout Increases
Chevron announced an increase to its quarterly distribution, moving from $1.71 to $1.78 per share. This represents an annual rate of $7.12 — delivering approximately 3.8% in yield. Shareholders registered by February 17 will receive payment on March 10.
The company’s payout ratio currently registers at 106.91%, indicating distributions exceed current earnings — a metric deserving continued monitoring.
Financial Results Show Mixed Performance
Chevron’s January 30 quarterly report revealed earnings per share of $1.52, surpassing analyst expectations of $1.44. Revenue, however, 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 and 7.89% return on equity. Wall Street projects annual EPS of $10.79.
The year-over-year earnings comparison reveals a notable decline — the energy giant delivered $2.06 EPS during the comparable quarter last year.
Major Investors Boost Holdings
Numerous institutional shareholders expanded their CVX stakes during the third quarter. Trivium Point Advisory LLC increased holdings by 73.9%, acquiring 6,855 additional shares for a total of 16,131 valued at approximately $2.5 million.
American Century Companies led institutional activity, adding 810,086 shares — representing a 45.6% expansion — for a total position of 2,586,278 shares worth roughly $401.6 million.
Berkshire Hathaway expanded its Chevron stake as well, following Warren Buffett’s transition from company leadership.
Institutional ownership currently represents 72.42% of shares outstanding.
Executive Stock Sales Continue
While institutional buyers have been active, corporate insiders have reduced positions. During the most recent quarter, insiders divested 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.
Insider ownership stands at just 0.21% of the company.
Wall Street’s Take on CVX
Analyst perspectives vary considerably. UBS maintains a buy recommendation with a $212 price objective. BMO Capital Markets continues its outperform rating at a $190 target. JPMorgan elevated CVX from neutral to overweight with a $176 target.
Conversely, a discounted cash flow analysis suggested the stock may be overvalued by approximately 30%, placing fair value near $126.
The overall consensus from 24 Wall Street analysts stands at “Hold” with a mean price target of $176.36 — representing downside from current trading levels.
CVX’s 50-day moving average stands at $169.52, while the 200-day average sits at $159.57. The company maintains a $372 billion market capitalization, trades at a PE multiple of 28, and has a beta of 0.70.
