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Chevron (CVX) has traded in a tight range over the past year, trading between $87 and $110. There is a reason the market has kept CVX in a tight range as all of the valuation metrics suggest that the stock is fairly valued. There is no doubt about it that Chevron is one of the most stable companies in the stock market and deserves its valuation, but if you are looking for upside, Chevron is one to avoid. The stock does pay a nice 3% dividend yield. Below is an in depth look at the valuations.

Valuation: Chevron's trailing 5 year valuation metrics suggest that the stock is fairly valued as there is a mixed message about the three valuation metrics compared to their 5 year averages. Chevron's current P/B ratio is 1.8 and it has averaged 1.9 over the past 5 years with a high of 2.7 and low of 1.4. Chevron's current P/S ratio is 0.9 and it has averaged 0.8 over the past 5 years with a high of 1 and low of 0.6. Chevron's current P/E ratio is 7.9 and it has averaged 9.4 over the past 5 years with a high of 14.7 and low of 6.3.

Price Target: The consensus price target for the analysts who follow Chevron is $124. That is upside of 17% from today's stock price of $106.66 and suggests that the stock is fairly valued at these levels. This also suggests that the stock has limited upside and should be avoided at its current stock price.

Forward Valuation: Chevron is currently trading at about $107 a share with analysts expecting EPS of $13.2 next year, an earnings increase of 4% y/y, for a forward P/E ratio of 8.1. Taking a look at the company's publically traded comparisons will give us a better idea of the stock's relative valuation. ConocoPhillips (COP) is currently trading at about $73 a share with analysts expecting EPS of $8.75 next year, an earnings increase of 6% y/y, for a forward P/E ratio of 8.4.

Exxon Mobil (XOM) is currently trading at about $86 a share with analysts expecting EPS of $8.99 next year, an earnings increase of 9% y/y, for a forward P/E ratio of 9.5. BP (BP) is currently trading at about $48 a share with analysts expecting EPS of $6.69 next year, an earnings increase of 5% y/y, for a forward P/E ratio of 7.1. The mean forward P/E of Chevron's competitors is 8.3 which suggests that Chevron is fairly valued relative to its publically traded competitors.

Earnings Estimates: Chevron has beat EPS estimates 3 times in the past 4 quarters. The company's EPS figures have come in between -26 cents and 28 cents from consensus estimates or about -9.2% to 7.8% from analyst estimates. The company has reported earnings that have differed from analyst estimates by a small margin which suggests that stock upside from earnings may be limited.

Price Action: Chevron is up 9.8% over the past year, outperforming the S&P 500, which is up 3.7%. Looking at the technicals, the stock is currently above its 50 day moving average, which sits at $104.95 and above its 200 day moving average, which sits at $100.15.

Source: Why You Should Avoid Chevron At These Prices