Why 2011 Treated Chevron So Well

As 2011 comes to a close, it's a great time to look back at what happened to the stocks that interest you. By making sure you know the important things that a company accomplished -- as well as the setbacks it experienced -- you can make a better decision about whether it's a smart investment for your portfolio.

Today, let's take a look at Chevron (NYSE: CVX  ) . As you'd expect from the energy giant, Chevron's fortunes are largely tied to oil and natural gas prices. But a wide range of activity around the world has things looking up for Chevron, and shareholders were clearly happy with the progress the company has made. Below, I'll take a closer look at the events that moved shares of Chevron this year.

Stats on Chevron

Year-to-Date Stock Return 20.2%
Market Cap $212 billion
1-Year Revenue Growth 23.6%
1-Year Profit Growth 61.1%
Dividend Yield 3%
CAPS Rating ****

Source: S&P Capital IQ.

Why did Chevron do well this year?
Chevron has benefited from strength in oil prices over the past year. During the third quarter, for instance, Chevron saw earnings more than double despite suffering from a slight drop in its daily production volumes.

But just as exciting as the raw profits that Chevron is generating is the company's reach around the world, with a huge number of projects with high potential. After delays following the Gulf disaster, the company plans to increase production from its Tahiti oilfield off the coast of Louisiana. Along with partners Total (NYSE: TOT  ) and Statoil (NYSE: STO  ) , Chevron has seen production of more than 100,000 barrels per day from the field, representing the bulk of its Gulf activity, and hopes to raise that by nearly 50% in the coming years.

An even bigger opportunity may come from Chevron's natural gas business. The company has two huge liquefied natural gas projects in Western Australia, working with a variety of partners with smaller stakes ranging from ExxonMobil (NYSE: XOM  ) and Royal Dutch Shell (NYSE: RDS-A  ) to Apache (NYSE: APA  ) . That dovetails well with Chevron's agreement with Cheniere Energy (AMEX: LNG  ) to use its Sabine Pass LNG terminal. Moreover, Chevron has searched for gas in Eastern Europe, including Poland and Bulgaria, with some success.

Given its size, Chevron tends to move in line with energy markets generally. But with its success this year, Chevron has set the stage for an even stronger future.

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Fool contributor Dan Caplinger doesn't own shares of the companies mentioned. Motley Fool newsletter services have recommended buying shares of Chevron, Total, and Statoil. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool has a disclosure policy.


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