Jim Cramer Stocks: 10 Latest Calls

4. Chevron Corp (NYSE:CVX)

Number of Hedge Fund Investors: 64

Jim Cramer was recently asked about Chevron in a latest program. Here is what he said:

“I think that Chevron is a buy. I think that they do a great job. I think that Mike Wirth (Chevron CEO) is terrific. And I think you should pick some up, this is a nice level,” Cramer said.

He also praised the stock’s dividend yield.

With 37 years of consistent dividend increases, oil giant Chevron Corporation (NYSE:CVX) is one of the best dividend growth stocks to buy according to hedge funds. Chevron Corporation (NYSE:CVX) has been paying dividends without a break since 1984. Its annual dividend growth rate over the past three years is 5.40%. Chevron Corporation (NYSE:CVX)’s payout ratio is about 56%, which is higher than the industry mean of 45%, but given the company’s huge cash flows and strong fundamentals, dividend safety isn’t a major concern for Chevron Corporation (NYSE:CVX) investors.

Chevron Corp’s (NYSE:CVX) management has pledged fiscal discipline and caution amid massive swings in oil and commodity prices. Analysts believe Chevron Corp (NYSE:CVX) remains well-positioned in the Permian Basin and DJ Basin, with strong production numbers posted in the first quarter. In April, Chevron Corp’s (NYSE:CVX) management said it expects $80/BBL Brent in 2024 and guided for a 4% to 7% increase in total production in the year. Analysts believe this guidance was conservative as continued supply cuts from oil producers would support oil prices.

Analysts also believe now that Hess shareholders have approved Chevron Corp’s (NYSE:CVX) $53 billion acquisition of the company, the deal could go through and help Chevron expand and achieve its goals in Guyana.

Chevron Corp (NYSE:CVX) is expected to see earnings growth of 10.57% in 2025, much higher than Exxon’s 6.72% earnings growth. Given all these growth catalysts, strong fiscal position and dividends, the stock is undervalued, at a forward P/E ratio of 13.89.