What Happened to LNG Stocks and 10 Best LNG Stocks to Buy Now

4. Chevron Corp (NYSE:CVX)

Number of Hedge Fund Holders: 64

Chevron Corporation (NYSE:CVX) is one of the largest energy companies engaged in integrated energy and chemical operations. Its upstream segment explores and develops oil and natural gas resources, while its downstream unit refines crude oil into petroleum products.

While the cost of oil and natural gas remains the primary factor influencing its financial outcomes, its midstream and downstream operations mitigate the extreme fluctuations characteristic of the energy market.

Although it has explored the realm of clean energy, it has ultimately decided to remain focused on the oil and natural gas industry. However, this doesn’t necessarily make it a poor choice. Indeed, the clean energy sector is expanding. Yet, oil and natural gas are expected to play a significant role for many years ahead.

Chevron’s LNG portfolio includes a 47.3% stake in Australia’s Gorgon LNG (15.6 MTPA), interests in Wheatstone LNG (8.9 MTPA), and Angola LNG (5.2 MTPA). The company is exploring expansion opportunities, including supplying gas to Europe via contracts with Cheniere and Venture Global. Additionally, Chevron is considering using gas from the eastern Mediterranean, acquired through Noble Energy, and evaluating a floating LNG facility to export gas to Europe.

Chevron Corporation (NYSE:CVX) stands out as one of the best LNG stocks to buy now owing to its strong cash flow. During the second quarter of 2024, the firm disclosed an operating cash flow of $6.3 billion, and its free cash flow amounted to $2.3 billion.

As a result of this strong cash flow, the company distributed $6 billion to its shareholders via dividends and stock buybacks. This achievement represented Chevron Corporation (NYSE:CVX) ‘s ninth quarter of delivering more than $5 billion in returns to shareholders.

With a payout ratio of 62%, the company offers a dividend yield of 4.51% while trading at a discount with a price-to-earnings multiple of 10. The firm has raised its yearly payout for an astonishing 37 straight years. This remarkable run is even more impressive when considering the fluctuations in energy costs during that time.

In the second quarter of 2024, Chevron Corporation (NYSE:CVX) appeared in 64 hedge fund portfolios, an increase from 62 in the previous quarter. Warren Buffett’s Berkshire Hathaway remains the largest shareholder, holding stakes valued at $18.55 billion.