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Why Chevron Is Too Cheap to Pass up

By Brian D. Pacampara, CFA - Apr 11, 2013 at 10:51AM

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Market-trouncing returns could be written in this 5-Star.

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, oil and gas giant Chevron (CVX 0.96%) has earned a coveted five-star ranking.

With that in mind, let's take a closer look at Chevron and see what CAPS investors are saying about the stock right now.

Chevron facts

Headquarters (founded)

San Ramon, Calif. (1879)

Market Cap

$232.4 billion

Industry

Integrated oil and gas

Trailing-12-Month Revenue

$222.6 billion

Management

Chairman/CEO John Watson

CFO Patricia Yarrington

Return on Equity (average, past 3 years)

21.1%

Cash/Debt

$21.9 billion / $12.2 billion

Dividend Yield

3.1%

Competitors

BP

ExxonMobil

ConocoPhillips

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 96% of the 4,270 members who have rated Chevron believe the stock will outperform the S&P 500 going forward.

Earlier today, one of those bulls, rtc76, succinctly summed up the Chevron bull case for our community:

Even if the Lago Agrio judgment ends up wiping out the full $19 billion of book value, it's still undervalued with a margin of safety if it can maintain a similar cash flow for the next few years. There are enough variables, though, such as difficulty in replacing reserves, the potential for a substantial drop in oil demand due to new supply and less than expected consumption growth in India or China, to warrant a very watchful eye over the next few years.

 Want to see how well (or not so well) the stocks in this series are performing? Follow the TrackPoisedTo CAPS account.

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Stocks Mentioned

Chevron Corporation Stock Quote
Chevron Corporation
CVX
$178.28 (0.96%) $1.69

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