Question 1

Why is Chevron's payout ratio above 100%?

Accepted Answer

Chevron paid more in dividends per share ($1.71) than it earned in Q4 2025 ($1.39 EPS), resulting in a 122.89% payout ratio. This happens when companies maintain dividends through periods of lower earnings, funding the gap with free cash flow or balance sheet reserves rather than cutting the distribution.

Question 2

What oil price does Chevron need to sustain its dividend?

Accepted Answer

Based on Q4 2025 margins, Chevron needs WTI crude above roughly $90/barrel to generate sufficient free cash flow to cover dividends and maintain capital spending. Below $80, the payout ratio would exceed 150% and force management to choose between the dividend, buybacks, or project spending.

Question 3

How does CVX's P/E compare to other oil majors?

Accepted Answer

Chevron's trailing P/E of 30.67 is approximately double the integrated oil major average. ExxonMobil trades around 14x earnings, and Chevron's own five-year average is closer to 15x. The premium reflects the market's pricing of sustained geopolitical supply risk and Chevron's LNG growth optionality.

Question 4

When does Chevron report next earnings?

Accepted Answer

Chevron reports Q1 2026 earnings on May 1, 2026. Key metrics to watch include upstream realized price per barrel, free cash flow per share (Q4 was $2.70), and the pace of share repurchases. Consensus expects approximately $2.10 EPS.

Quarter	Revenue	Net Income	EPS
2025-12-31	$45.79B	$2.77B	$1.39
2025-09-30	$48.17B	$3.54B	$1.83
2025-06-30	$44.38B	$2.49B	$1.45
2025-03-31	$47.61B	$3.51B	$2.01

Chevron Corporation

Price History (1 Year)

AI Analysis

CVX: Dividend Math Doesn't Work Below $90 Oil

Energy Peers