Josh Brown Buys Chevron: Analysis of Energy Sector Picks

Josh Brown's Chevron Investment Rationale

• 💡 Chevron has been added to Josh Brown's "best stocks in the market" list due to strong technical indicators, including support at the rising 200-day moving average and an uptrend with a 50-day moving average.
• 📊 The stock shows a 17x trailing PE and 13x forward PE, with projected earnings growth of 3% this year and 17% next year.
• ⚠️ Two major overhangs, drilling in Venezuela and the acquisition of Hess, are seen as nearing resolution, which could catalyze a breakout.
• 🌍 The Venezuela situation involves potential US policy shifts that could prevent Chinese dominance, while the Hess acquisition is signaled as likely to close, evidenced by Chevron's $2.3 billion open market purchase of Hess shares.

Jim Lebenthal's Exxon Mobil Preference

• 🎯 Jim Lebenthal identifies Exxon Mobil as his top energy pick, emphasizing the importance of investing in the "creme de la creme" of any sector.
• 📈 Both Exxon Mobil and Chevron are considered titans in the energy sector, with similar valuations and Exxon having a slightly lower dividend yield compared to Chevron.
• 🗣️ Lebenthal's preference for Exxon is based on historical reasons and a past divergence in share performance, highlighting that either stock is a strong choice for sector exposure.

Strategic Importance and Investor Confidence

• 💰 Chevron offers a 4% dividend yield and a significant buyback program, making it attractive to investors.
• 🇺🇸 The company's strategically important assets align with the current US president's agenda, potentially offering political tailwinds.
• 🤝 Berkshire Hathaway, holding 118 million shares of Chevron, underscores its significant position and investor confidence in the company, representing about 6% of their portfolio.