Key Points
I recently wrote that Chevron (NYSE: CVX) is extremely well-positioned at the moment, given elevated oil prices, a global shortage of refining capacity, and the new deal that will allow U.S. companies to access Venezuelan oil.
I’m clearly not the only investor bullish on Chevron. The stock is up 41% year to date, far outperforming both the broader market, which is up 12% this year as measured by the S&P 500 (SNPINDEX: ^GSPC), and its biggest competitor, ExxonMobil, which is up 38%.
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But owning shares of Chevron brings another benefit: The company pays a quarterly dividend of $1.79 per share. That makes its annual per-share dividend $7.12 and its dividend yield 3.31%, based on the current share price of $215. That’s a pretty good dividend yield for any stock.
Image source: Getty Images.
So, if you wanted to earn $500 a month from Chevron stock, what size investment would you have to make?
Well, you would need to own about 842 shares of the stock to earn that much in monthly income. At the current price, that would cost a bit more than $181,030. That’s a sizable investment, to be sure. But keep in mind that, given Chevron’s potential upside, you’re likely to see the share price rise, too.
The average price target among analysts following Chevron is $221, and of the 25 major analysts following it, 20 rate it either a “buy” or a “strong buy.” I agree with them.
Should you buy stock in Chevron right now?
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Matthew Benjamin has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Chevron. The Motley Fool has a disclosure policy.