Chevron Corp (CVX) stock still looks inexpensive here with its 4.05% dividend yield and forward earnings multiple of 12x. As a result, CVX is worth substantially more, as much as $185.23 per share, or an upside of 15% from today. Moreover, it makes sense for existing shareholders to short out-of-the-money (OTM) put options for extra income.
The oil and gas company raised its dividend per share (DPS) higher than expected to $6.52 per share on Feb. 2. I had previously predicted in my Jan. 19 Barchart article that it would raise the DPS by 6.3% from $6.04 to $6.42. Instead, Chevron hiked it by almost 8% (7.95%). This indicates the company has high confidence in its free cash flow generation.
