Chevron Corporation (CVX) just declared $1.12 quarterly dividend. This is an increase of 3.7% from $1.08.
I own 31 shares, so this will increase my annual dividend income by $4.96 to a total of $4,722.96
This was another unexpected but pleasant increase from Chevron. The last increase was only 0.9% in October 2016. Before that increase, it took the company eight quarters straight to announce an increase.
Currently, the dividend payout stands at 126% which is not a good thing. The one saving factor that is going to help Chevron is the future earnings growth. The future earning growth will bring down the dividend payout ratio. CFRA has a 3-year earning prediction of a whopping 20% for the company. This kind of growth will definitely bring the payout ratio back to manageable and safe level.
I find that Chevron to be expensive with a current PE of 34.11; however, it does have a forward PE of 18.40. Even though the forward PE looks great, I give this stock a HOLD recommendation.
I currently have a significant position with this company, and I will only buy more shares if there is a significant drop in price.
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