XOM - Chevron: I Don't Own It But I Should As It Yields Over 4%
2024-07-08 09:00:00 ET
Summary
- Bullish on the oil and gas industry, with a focus on Chevron and other producers.
- Chevron positioned for growth with strong financials, buyback plans, and increased production.
- Chevron offers value opportunity with high dividend yield and potential for capital appreciation.
I have been a fan of the oil and gas industry for some time and am invested in several upstream producers, such as Exxon Mobil (XOM), and BP p.l.c (BP), in addition to midstream operators, including Energy Transfer (ET), Enterprise Products Partners (EPD), Kinder Morgan (KMI), and Enbridge (ENB). The more I look at how the global energy mix is evolving the more I get bullish on the oil and gas industry. I am pro-renewables and have several investments in the space, but the reality is that hydrocarbons will be needed for decades to come as the transition from traditional energy sources is going to take far longer than what some agendas wanted. The energy industry is one of the hardest to compete in, and I believe we will see further consolidation to drive efficiencies and scalability rather than new competition entering the marketplace. Chevron could be the most interesting supermajor in the upstream segment of the oil patch, and I think it can break out of its sideways trajectory. CVX is generating tens of billions in profitability, has strong financials, and is looking to resume its buybacks at an annual rate of $17.5 billion once the Hess shareholder vote concludes. The combination of increased production from CVX and the price of crude staying above $60 is a winning combination that should translate to capital appreciation and increased dividend income for shareholders....
Chevron: I Don't Own It But I Should As It Yields Over 4%