Dividend Safety in the Oil & Gas Giants: Exxon Mobil Corporation (XOM), Chevron Corporation (CVX), Occidental Petroleum Corporation (OXY)

Page 1 of 2

There’s no doubt that one of the most stable industries out there is that of the integrated oil and gas firms. These companies are highly profitable and tend to pay some of the highest dividends in the market. The three stocks highlighted in this article are U.S. traded and major players in the oil and gas space.

So, why these three? Well, each one has an annual dividend growth rate that has exceeded 10% over the past five years. That means that while paying pretty good dividends, they are continuing to grow them. These companies also have relatively small payout ratios; we don’t want to be buying into a company that can’t possibly sustain its payouts, so a low ratio is great for us.

Exxon Mobil Corporation (NYSE:XOM)The three companies that we’ll take a look at in this article are Exxon Mobil Corporation (NYSE:XOM), Occidental Petroleum Corporation (NYSE:OXY) and Chevron Corporation (NYSE:CVX). These three companies meet the outlined criteria above, and they also happen to be among the best of the integrated oil and gas companies. Let’s take a look at them individually.

The TITAN

Exxon Mobil Corporation (NYSE:XOM) is quite clearly the titan of the field. This company has a long standing record in American history and is currently battling with Apple Inc. (NASDAQ:AAPL) over the top market cap spot. Now, let’s get to the meat of it: Why is Exxon Mobil on this list? Probably because of their 10.2% annual dividend growth rate–that’s a pretty solid number and is something that any dividend investor would love to see.

The current yield on XOM stock is 2.55%, and that’s with a 9.2 P/E ratio. Exxon Mobil Corporation (NYSE:XOM) has a very low payout ratio that sits right around the 22% mark, a number that indicates that Exxon has the capability to increase the dividend more over the coming years. Another number I like at the company? How about price to sales. It’s at 0.84. Sub-one numbers aren’t uncommon in the oil and gas industry, but at least you’re paying less than one year’s sales for the company.

When compared to other companies, Exxon Mobil Corporation (NYSE:XOM) does have a price to book value that is a bit on the high side at 2.45. This obviously comes about because of the name recognition that Exxon brings along with it. If you’re looking for a company that’s right around the 1.00 mark then you should check out BP plc (ADR) (NYSE:BP); they’re sitting at 1.09 at the time of writing.

Another Rockefeller Entry

Whether you like it or not, J.D. Rockefeller has his name everywhere in the oil and gas industry. His standard oil company is the founding basis for many current oil companies, and Chevron Corporation (NYSE:CVX) is no exception. Chevron made it onto this list of top companies by increasing their dividend by an average annual rate of 13.93% over the last five years, beating out Exxon but leaving room for our number three stock!

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 44 percentage points in 21 months Learn how!

Lists

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

12 Most Expensive Countries for Foreign Students

Top 30 Most Influential Women in the World

Top 20 Most Expensive New Year Eve Shows

Top 5 Best Vocational Careers

Top 10 Jobs for 2014 by Salary Gain (Predictions)

Top 5 Digital Trends for 2014

Top 6 Things You Can Do To Increase Your Productivity

Top 9 Trending Smartphones in 2013

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!