5 Corporate Giants at Wholesale Prices

Giant #3: Chevron (CVX)

Oil companies are making money hand over fist. If you want to own a piece of that cash flow, now is the time to jump on the bandwagon.

Crude prices fell off the cliff, and stocks of oil companies struggled in the downdraft. That is an opportunity to buy a huge company at a low price. One name to consider is Chevron (CVX).

I’m betting that oil prices stabilize and then increase from here. As such, CVX is poised to benefit. At $70 per share or so, CVX trades at a discount to its 52-week high of $105. Shares trade for just 6 times trailing earnings and 11 times forward earnings. The higher forward valuation is due to the drop in oil prices.

If you believe as I do that oil prices will only increase over time, CVX’s earnings will push that valuation lower. Even better, the stock price should rise as a result. While you wait, the company pays a nice dividend of 3.6%.

Next: Citigroup (C)