Motley Fool: Consider Chevron
Given the world’s reliance on energy, you might want to invest in it. If so, consider one of the world’s largest energy companies: Chevron (NYSE: CVX). It’s diversified, with a global portfolio of assets. It’s involved in the entire energy value chain, including exploring for oil and gas; transporting, refining and marketing them; and producing petrochemicals and additives.
Chevron is run conservatively. That shows up on the balance sheet, given its low debt-to-equity ratio of 0.25. And it shows up in the dividend, which has been increased for decades despite the inherent volatility of the energy sector. On top of that, the dividend yield was recently an attractive 3.7%.
The energy sector has always been volatile, and conflict in the Middle East has certainly caused disruption; Chevron is looking into building a pipeline to bypass the Strait of Hormuz. It’s also working with Microsoft to power one of its new artificial intelligence data centers in West Texas with natural gas, bypassing local electric utilities. These are promising new directions for the company, and evidence that it can pivot as needed to keep growing.
For most investors in the energy patch, Chevron is a good choice. (The Motley Fool owns shares of and recommends Chevron.)
Ask the Fool
Q. What happens to my debts after I die? – L.T., Murfreesboro, Tennessee
A. When people die, their debts are generally paid from their estate, which includes assets such as financial accounts, a home and other property. Typically, a named executor or a probate court administrator manages the estate in accordance with probate rules.
If the estate can’t cover your debt, it might go unpaid. Your survivors are generally not on the hook to pay off your debts unless they co-signed a loan or are a joint owner of a credit card account. (Authorized users of a card are not joint owners and are not responsible for debts.) Some states, such as community property states, do require a surviving spouse to repay certain debts. With mortgages, any co-borrower will be expected to keep making payments, and whoever inherits the property may have to pay – or sell.
It’s worth looking into the terms of your various debts to know which rules apply. Note that the IRS will likely bill heirs of the estate for any taxes due.
Q. Can I buy shares of stock directly from companies instead of through a brokerage? – S.H., Providence, Rhode Island
A. With many companies, you can. Most folks own stocks in brokerage accounts and via mutual funds or exchange-traded funds. But you may also be able to buy shares directly from companies that offer a Dividend Reinvestment Plan (sometimes referred to as a “DRIP”), Direct Stock Purchase Plan or similar programs. Such plans generally charge low or no fees, and they often allow you to reinvest dividends in additional shares or fractions of shares (though reinvested shares can require extra record-keeping).
My dumbest investment
My most regrettable financial move was taking a colleague’s advice and putting most of my money into a cryptocurrency he said was fail-proof. Well, it failed. I was lucky to stay above water with it. – D.K., online
The Fool responds: Few investments are fail-proof. Even blue-chip companies can fall on hard times and see their stocks drop for an extended period, and some blue-chip companies even end up going out of business.
There are many types of cryptocurrencies, and they can be complicated and hard to understand. Never invest in anything that you don’t understand fairly well – you need to truly appreciate the risks involved, along with the possible rewards.
Cryptocurrencies tend to be volatile and vulnerable to security issues. It’s true that plenty of people have made hefty profits with crypto, but many others have not. The California Department of Financial Protection and Innovation (DFPI) warns investors: “Exercise caution when dealing with crypto. Consult with trusted advisors, and with state and federal consumer watchdog organizations.”
DFPI adds a warning about crypto payments: “Bogus text messages, spam calls, and phishing are just part of the new toolbox of nightmares that scammers have available to them. And crypto – hard-to-trace, decentralized, anonymized – is practically custom-made for today’s online scammer.”
Do you have a smart or regrettable investment move to share with us? Email it to TMFShare@fool.com.