When you mention oil dividends to investors these days, you might be met with mixed emotions. The XOM stock dividend, for instance, is a popular blue-chip dividend play for oil investors. You probably won’t hear too many negative things about ExxonMobil stock or However, there is another world of oil dividends that mainstream investors
ExxonMobil (XOM) has long been a safe haven for income investors, offering a reliable 3.69% dividend like a steady lighthouse in the stormy seas of the financial markets. But in today’s yield-starved landscape, two other oil players are emerging from the shadows, their dividend streams gushing with potential that could captivate even the most seasoned income seeker: Petroleo Brasileiro (PBR) and Devon Energy (DVN).
PBR: The Brazilian Bonanza with a 16.99% Windfall (and its Undercurrents)
PBR, the undisputed heavyweight of Brazil’s oil industry, throws a financial punch with a staggering 16.99% dividend – nearly five times the XOM stock dividend! Imagine, for every $1,000 you invest, you receive almost $170 back annually. You could also reinvest those dividends and let your holdings compound.
It’s like owning a personal oil well, gushing forth a seemingly endless stream of cash. This outsized payout stems from Brazil’s favorable tax regime and PBR’s strategic focus on mature fields brimming with easily extracted oil. It’s a siren song for income investors seeking outsized returns. Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our Energy and Capital investment community is sign up for the daily newsletter below.
Our analysts have traveled the world over, dedicated to finding the best and most profitable investments in the global energy markets. All you have to do to join our Energy and Capital investment community is sign up for the daily newsletter below.
However, as with any alluring melody, there are underlying notes of caution to heed. PBR’s stock price can be as unpredictable as a Rio Carnival samba, with sharp swings that could leave even the most seasoned investor seasick. Additionally, the future of this gushing dividend stream might be tied to the whims of Brazilian government policies. So, while the yield is undeniably tempting, be prepared for a potentially volatile ride before setting sail on this Brazilian adventure.
DVN: The American Gusher with a 6.83% Geyser (and its Tremors)
Closer to home, DVN, a U.S. shale giant, entices investors with a 6.83% dividend – almost double the XOM stock dividend. This robust payout reflects DVN’s commitment to rewarding shareholders handsomely. Imagine, collecting almost 7 cents for every dollar invested each year! It’s like having a personal shale deposit, consistently showering you with cash.
But like any good wildcatter, DVN’s investors must be prepared for the inherent risks of the shale patch. The company’s dividend, much like the fickle Texas weather, could be sensitive to oil price fluctuations. If the oil market takes a tumble, DVN’s gusher might sputter and slow. So, before joining the shale party, buckle up for the potential of some bumps and dips along the way.
The Showdown: Choosing Your Dividend Champion (and the Right Battleground)
So, which oil play should you crown your oil dividend king?
- Exxon Mobile Corporation (NYSE: XOM), 3.69% dividend.
- Petróleo Brasileiro S.A. – Petrobras (NYSE: PBR), 16.99% dividend.
- Devon Energy Corporation (NYSE: DVN), 6.83% dividend.
It all boils down to a crucial question: what kind of investor are you?
XOM: The Steady Stream for the Risk-Averse Investor
If you’re a seasoned investor seeking a reliable, predictable income stream, the XOM stock dividend might be your knight in shining armor. Its dividend has flowed like clockwork for decades, even through turbulent times. Think of it as a slow, steady river, gently winding its way through the financial landscape, offering a smooth and predictable journey.
PBR: The High-Yield Gamble for the Thrill-Seeker
If you’re an adventurous investor with a strong stomach for volatility, PBR could be your wild card. Its massive dividend could supercharge your portfolio, but be prepared for potential price swings and policy uncertainties. Think of it as a thrilling whitewater rafting trip – exciting, and exhilarating, but not for the faint of heart.
DVN: The High-Yield Geyser for the Calculated Risk-Taker
DVN offers a middle ground, with a yield significantly higher than XOM’s but potentially less volatile than PBR’s. Its focus on low-cost production and strong cash flow suggests a sustainable payout, but oil price fluctuations could still throw a wrench in the works. Think of it as a challenging mountain hike – rewarding with breathtaking views, but demanding a steady pace and awareness of the potential dangers.
A Brief Overview of XOM Stock Dividend History
XOM stock has a long history of increasing its dividend, even during recessions. This suggests that the company is committed to returning cash to shareholders and has a strong financial foundation.
Take a look at a brief rundown of the XOM stock dividend:
- 41 consecutive years of dividend increases: This makes XOM a Dividend Aristocrat, a prestigious group of companies with at least 25 years of consecutive dividend increases.
- Current dividend yield: 3.69% (as of February 1, 2024)
- Average annual dividend growth over the past 10 years: 6.5%
- Average annual dividend growth over the past 5 years: 4.2%
- 5-year dividend payout ratio: 41.6% (meaning the company pays out 41.6% of its earnings as dividends)
- Dividend payment schedule: Quarterly
Additionally, you may want to consider these facts while examining the XOM stock dividend. The dividend payout ratio is currently in the healthy range, suggesting that the company has room to continue increasing its dividend in the future.
However, the company’s future dividend growth could be impacted by several factors, such as oil prices and the company’s financial performance.
Forget the XOM Stock Dividend! The Oil Surge We’ve Been Waiting For is Here
Turn on the TV or open the financial newspaper, and you’ll hear about a major oil rally.
Major banks and sector analysts say we’re heading for triple-digit oil prices by the end of 2023. Jeff Currie, the global head of Commodities at Goldman Sachs, expects $110 oil. Daniel Yergin, the chairman of S&P Global, said oil prices could hit $121. Amrita Sen, director of research at Energy Aspects, said $130 oil is not out of the question.
But here’s the thing…
My colleague Keith Kohl says they’re all dead wrong. Keith has a 20-year track record in the energy sector with more than a dozen 100% oil and gas recommendations under his belt. He says this is NOT your typical oil price rally — it’s much, much different.
Due to the convergence of three, powerful economic triggers, Keith says oil prices will not come down for years. As Keith outlines in this new and urgent briefing, we saw this happen at the beginning of the last two oil bull markets…
When these “perfect storm” conditions caused oil prices to skyrocket…
And 11 different oil and gas stocks made investors 1,000% returns or more. That’s why Keith just announced his No. 1 oil stock of the decade. You can get the name, ticker symbol, and full analysis inside. But I suggest you act quickly.
Global oil demand has hit 103 million barrels per day in 2023. Things don’t appear to be slowing down in 2024, either. To be clear, we’ve never seen oil demand hit levels this high before — ever!
So you want to get in on this stock now, BEFORE oil prices surge even further. While the payments from the XOM stock dividend could be profitable, the potential growth doesn’t compare to Keith’s number one oil play.