4 Rock-Solid Oil Dividends

Focus: STOCKS

Kelley Wright Image Kelley Wright Managing Editor, Investment Quality Trends

Names like Chevron have been growing their dividends "since the earth cooled," says Kelley Wright, who explains why that is so important when evaluating energy stocks.

Oil is on the minds of a lot of investors and traders on a daily basis these days, but where is the value there? My guest today is Kelley Wright to talk about that. So, Kelley, you’re seeing some value in oil companies these days. Talk about that.

We are. Chevron Texaco—but we just call it Chevron (CVX) now. I just aged myself. It has a phenomenal track record of increasing the dividend at least 10% a year, and they’ve been doing it pretty much since the earth cooled, so doing it for a long time. But they just raised it another 11% again.

So, they’re paying about $3.60 a share. But more importantly, whenever Chevron offers a yield of at least 3.5%, that’s a great historically repetitive value for them, and they’re right in that range right now.

Exxon Mobil (XOM) just increased their dividend by about 22%. The single largest dividend increase at any one time in history for them. They offer tremendous value. ConocoPhillips (COP), another big oil company, great dividend yield, right around 4%.

So, what we’re seeing then is really historically repetitive areas of pretty high yield for some of the biggest, best capitalized, well known oil companies that there are.