Chevron (CVX) Gains As Market Dips: What You Should Know
Zacks Investment Research | Nov 19, 2018 05:45AM ET
In the latest trading session, Chevron (CVX) closed at $119.42, marking a +0.3% move from the previous day. The stock outpaced the S&P 500's daily loss of 1.66%. At the same time, the Dow lost 1.56%, and the tech-heavy Nasdaq lost 3.03%.
Prior to today's trading, shares of the oil company had gained 1.35% over the past month. This has outpaced the Oils-Energy sector's loss of 8.12% and the S&P 500's loss of 2.43% in that time.
Investors will be hoping for strength from CVX as it approaches its next earnings release, which is expected to be February 1, 2019. In that report, analysts expect CVX to post earnings of $2.47 per share. This would mark year-over-year growth of 238.36%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $44.78 billion, up 19.04% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $8.25 per share and revenue of $168.77 billion. These totals would mark changes of +122.97% and +19.08%, 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. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.
Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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.
Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.26% higher within the past month. CVX is currently a Zacks Rank #3 (Hold).
Looking at its valuation, CVX is holding a Forward P/E ratio of 14.43. For comparison, its industry has an average Forward P/E of 10.95, which means CVX is trading at a premium to the group.
We can also see that CVX currently has a PEG ratio of 2.06. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Oil and Gas - Integrated - International industry currently had an average PEG ratio of 1.13 as of yesterday's close.
The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 21, which puts it in the top 8% 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.
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