Is Chevron Corporation (CVX) Stock Trading Below Fair Value?
Investors Observer gives Chevron Corporation (CVX) a low valuation score of 34 based on its analysis. The proprietary rating system takes into account the underlying health of a company by analyzing its stock price, earnings and rate of growth. CVX currently holds a better value than 34% of the shares based on these metrics. Long-term buy and hold investors should find the most relevant valuation ranking system when making investment decisions.
CVX’s 12-month price-to-earnings (PE) ratio of 51.7 puts it above the historical average of around 15. CVX is a mediocre value at its current price, as investors pay more than what. it is worth relative to the company’s profits. . CVX’s last 12-month earnings per share (EPS) of 1.87 does not justify what it is currently trading in the market. Tracking PE ratios, however, do not take into account a company’s projected growth rate, resulting in some companies having high PE ratios due to high growth potentially attractive to investors even though current earnings are weak. CVX has a 12-month forward PEG to Growth Ratio of 2.97. The markets are overvaluing CVX relative to its projected growth, as its PEG ratio is currently above fair market value of 1. The PEG of 1.87 is derived from its forward price / earnings ratio divided by its growth rate. PEG ratios are one of the most widely used valuation metrics due to the incorporation of more fundamental business metrics and the focus on the future of the business rather than its past.
CVX valuation measures are low at its current price due to an overvalued PEG ratio despite strong growth. CVX’s PE and PEG are lower than the market average, resulting in a below-average valuation score. Click here for the full Chevron Corporation (CVX) stock report.