With shares of Chevron Corporation (NYSE:CVX) now trading at $102.50, is CVX a Buy, a Wait and See, or a Stay Away? Let’s analyze the stock with the relevant sections of our CHEAT SHEET investing framework:
C = Catalyst for Stock’s Movement
Chevron posted fairly lackluster earnings at the beginning of November. Revenue fell 8.2 percent year over year to $56 billion, while net income dropped 32.3 percent to $2.69 per share, and fell short of estimates on both fronts.
While it’s not the best in its class, Chevron’s debt-to-equity ratio of 0.09 still looks pretty good. Exxon Mobil (NYSE:XOM) edges in with a debt-to-equity ratio of just 0.07. British Petroleum (NYSE:BP) tends to play a slightly more capital-intensive game, and clocks in with a debt-to-equity ratio of 0.42.
Chevron is sitting on total cash of $21.58 billion, and total debt of $12.34 billion. Oil and gas plays in North America have been heating up for a while, and this cash could soon translate into additional shale assets.
Exxon Mobil, which has a market cap nearly twice the size of Chevron’s, has just $13.06 billion in total cash, with $12.42 billion in total debt. Exxon Mobil’s cash pile looks a little depleted this quarter after some oil and gas shale acquisitions, namely a $3.14 billion purchase of Celtic Exploration and a $1.6 billion purchase from Denbury Resources (NYSE:DNR). Chevron may have some catching up to do.
BP has $16.36 billion total cash and $41.31 billion in total debt.
T = Technicals on the Stock Chart are Not Strong
As of November 12, the stock price is 4.48 percent below its 20-day simple moving average, or SMA; 6.80 percent below its 50-day SMA, and 0.76 percent below its 200-day SMA.
Since the beginning of 2012, the stock price has been in a downward trend, losing 4.6 percent of its value this year to date, and 0.8 percent year over year.
This compares to a 0.5 percent year-to-date gain for Exxon Mobil and an 8.1 percent year-to-date loss for BP.
The stock is trading in a 52-week range of $92.29 to $118.53 per share.