Chevron (NYSE: CVX) and Sasol (NYSE:SSL) are both large-cap oils/energy companies, but which is the better stock? We will compare the two companies based on the strength of their profitability, analyst recommendations, dividends, institutional ownership, earnings, risk and valuation.
This table compares Chevron and Sasol’s net margins, return on equity and return on assets.
||Return on Equity
||Return on Assets
This is a breakdown of current ratings for Chevron and Sasol, as reported by MarketBeat.
||Strong Buy Ratings
Chevron currently has a consensus target price of $131.95, indicating a potential upside of 10.67%. Given Chevron’s higher possible upside, equities analysts clearly believe Chevron is more favorable than Sasol.
Chevron pays an annual dividend of $4.48 per share and has a dividend yield of 3.8%. Sasol pays an annual dividend of $0.62 per share and has a dividend yield of 1.7%. Chevron pays out 121.1% of its earnings in the form of a dividend, suggesting it may not have sufficient earnings to cover its dividend payment in the future. Sasol pays out 24.0% of its earnings in the form of a dividend. Chevron has increased its dividend for 32 consecutive years. Chevron is clearly the better dividend stock, given its higher yield and longer track record of dividend growth.
Volatility & Risk
Chevron has a beta of 1.16, suggesting that its stock price is 16% more volatile than the S&P 500. Comparatively, Sasol has a beta of 0.9, suggesting that its stock price is 10% less volatile than the S&P 500.
Earnings and Valuation
This table compares Chevron and Sasol’s gross revenue, earnings per share and valuation.
||Earnings Per Share
Chevron has higher revenue and earnings than Sasol. Sasol is trading at a lower price-to-earnings ratio than Chevron, indicating that it is currently the more affordable of the two stocks.
Insider and Institutional Ownership
65.0% of Chevron shares are owned by institutional investors. Comparatively, 2.1% of Sasol shares are owned by institutional investors. 0.4% of Chevron shares are owned by insiders. Comparatively, 1.0% of Sasol shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company will outperform the market over the long term.
Chevron beats Sasol on 13 of the 17 factors compared between the two stocks.
Chevron Corporation, through its subsidiaries, engages in integrated energy, chemicals, and petroleum operations worldwide. The company operates in two segments, Upstream and Downstream. The Upstream segment is involved in the exploration, development, and production of crude oil and natural gas; processing, liquefaction, transportation, and regasification associated with liquefied natural gas; transportation of crude oil through pipelines; and transportation, storage, and marketing of natural gas, as well as operates a gas-to-liquids plant. The Downstream segment engages in refining crude oil into petroleum products; marketing crude oil and refined products; transporting crude oil and refined products through pipeline, marine vessel, motor equipment, and rail car; and manufacturing and marketing commodity petrochemicals, and fuel and lubricant additives, as well as plastics for industrial uses. It is also involved in the cash management and debt financing activities; insurance operations; real estate activities; and technology businesses. The company was formerly known as ChevronTexaco Corporation and changed its name to Chevron Corporation in 2005. Chevron Corporation was founded in 1879 and is headquartered in San Ramon, California.
Sasol Limited operates as an integrated chemicals and energy company. It operates through Mining, Exploration and Production International, Energy, Base Chemicals, and Performance Chemicals segments. The company operates coal mines; develops and manages upstream interests in oil and gas exploration and production in Mozambique, South Africa, Australia, Canada, and Gabon; and markets commodity and various performance chemicals, such as organics, inorganics and wax value chains, as well as polymers, solvents, and ammonia-based fertilizers. It also sells liquid fuel products to retail and commercial customers and other oil companies; markets, distributes, and transports pipeline gas, as well as maintains pipelines that are used to transport gas; and provides low-carbon electricity. In addition, the company provides engineering, research and development, and technology transfer services; develops and implements international gas-to-liquids and coal-to-liquids ventures; manages cash resources; invests and procures loans; markets lubricants; develops lower-carbon energy solutions; produces, markets, and distributes chemical products; and trades and transports oil products, petrochemicals, and chemical products and derivatives. Sasol Limited was founded in 1950 and is headquartered in Johannesburg, South Africa.
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