CVX

Insights into Chevron (CVX) for Investors

A strong performer from today's evening trading session is Chevron, whose shares rose 2.2% to $156.64 per share. For those of you thinking about investing in the stock, here is a brief value analysis of the stock using the company's basic fundamental ratios.

Chevron's Valuation Is in Line With Its Sector Averages:

Chevron Corporation, through its subsidiaries, engages in the integrated energy and chemicals operations in the United States and internationally. The company belongs to the Energy sector, which has an average price to earnings (P/E) ratio of 14.36 and an average price to book (P/B) ratio of 2.1. In contrast, Chevron has a trailing 12 month P/E ratio of 14.4 and a P/B ratio of 1.8.

Chevron's PEG ratio is 2.57, which shows that the stock is probably overvalued in terms of its estimated growth. For reference, a PEG ratio near or below 1 is a potential signal that a company is undervalued.

Generally Positive Cash Flows but an Average Current Ratio:

2018 2019 2020 2021 2022 2023
Revenue (M) $166,339 $146,516 $94,692 $162,465 $246,252 $200,949
Operating Margins 12% 4% -8% 13% 20% 15%
Net Margins 9% 2% -6% 10% 14% 11%
Net Income (M) $14,824 $2,924 -$5,543 $15,625 $35,465 $21,369
Net Interest Expense (M) $748 $798 $697 $712 $516 $469
Depreciation & Amort. (M) $19,419 $29,218 $19,508 $17,925 $16,319 $17,326
Diluted Shares (M) 1,914 1,895 1,870 1,920 1,940 1,880
Earnings Per Share $7.74 $1.54 -$2.96 $8.14 $18.28 $11.36
EPS Growth n/a -80.1% -292.21% 375.0% 124.57% -37.86%
Avg. Price $96.55 $99.89 $77.09 $96.37 $147.4 $156.64
P/E Ratio 12.36 64.45 -26.04 11.82 8.03 13.73
Free Cash Flow (M) $16,826 $13,198 $1,655 $21,131 $37,628 $19,780
CAPEX (M) $13,792 $14,116 $8,922 $8,056 $11,974 $15,829
EV / EBITDA 5.36 6.36 15.06 5.54 4.5 6.73
Total Debt (M) $39,356 $31,762 $37,049 $33,691 $27,389 $25,379
Net Debt / EBITDA 0.75 0.9 3.04 0.84 0.15 0.37
Current Ratio 1.25 1.07 1.18 1.26 1.47 1.27

Chevron benefits from strong operating margins with a positive growth rate, generally positive cash flows, and growing revenues and a flat capital expenditure trend. The company's financial statements show positive EPS growth and healthy leverage levels. Furthermore, Chevron has just enough current assets to cover current liabilities, as shown by its current ratio of 1.27.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.

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