You still need Resources in your portfolio

Article Excerpt

Prices for commodities such as crude oil, iron ore and copper have weakened lately as investor fear rising interest rates will trigger an economic slowdown. Even so, we continue to recommend all investors maintain exposure to resources as the sector’s high-quality producers will still gain as the economy rebounds. CHEVRON CORP. $161 is a buy. The company (New York symbol CVX; Conservative Growth Portfolio, Resources sector; Shares outstanding: 1.9 billion; Market cap: $305.9 billion; Price-to-sales ratio: 1.3; Dividend yield: 3.8%; TSINetwork Rating: Average; www.chevron.com) is the second-largest integrated oil producer in the U.S. by revenue after ExxonMobil (New York symbol XOM). Producing oil and natural gas supplies 80% of Chevron’s earnings. Based on current production rates, its reserves of 11.2 billion barrels (as of December 31, 2022) should last roughly 10 years. The remaining 20% comes mainly from refineries and supply fuel to 8,200 gas stations in the U.S. In the fourth quarter of 2022, Chevron’s production fell 3.4%, to 3.01 million barrels a day (58%…