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Chevron stock is down 2.2% today (Friday) after a dismal Q4 earnings report, but this isn't a buy low opportunity. Investors should look elsewhere for profitable energy plays in 2017.
Today's Chevron earnings report showed the company's earnings per share (EPS) fell well below expectations. Analysts were expecting the company to report earnings of $0.64 per share. Instead, Chevron reported earnings of $0.22 per share.
Chevron Corp. (NYSE: CVX) stock is currently trading at $113.99. CVX stock is down 2.2% on the day and down 3.18% since the start of the year.
John Watson, Chevron's CEO and chairman, said low oil prices in 2016 were to blame for the company's poor earnings.
But other oil companies had no problems growing in 2016.
We'll show you an oil stock that grew 47% in 2016 and how analysts are now projecting up to 91% EPS growth this year.
Before we show you the oil stock to buy instead, here's why you shouldn't buy Chevron stock...
Why Investors Need to Avoid Chevron Stock
Big Oil stocks jumped after Donald Trump won the presidency on Nov. 8. But that optimism will be short-lived.
Donald Trump ran on a platform promising to make "America energy independent." That meant he planned to roll back environmental regulations that restricted oil and gas production.
President Trump's nominations of former Exxon Mobil Corp. (NYSE: XOM) CEO Rex Tillerson to run the State Department and former Oklahoma Attorney General Scott Pruitt to run the EPA signaled he was ready to follow through on an "America first" energy policy.
That's why Chevron stock climbed 8% between Election Day and Trump's inauguration.
And this week President Trump signed an executive order to allow the construction of the Keystone XL and Dakota Access pipelines, which means expectations of fewer regulations on oil companies are starting to become reality.
Trending: There Are Big Changes and Big Profits Coming to the Oil Sector in 2017
But that doesn't mean oil majors like Chevron are going to reap the benefits.
In fact, "things will get even worse for Big Oil in 2017," according to Money Morning Global Energy Strategist Dr. Kent Moors.
You see, Big Oil firms are too bogged down in "megaprojects" and protecting their high dividend payments. That means they're missing out on where the "real money in oil is being made," according to Moors.
Chevron just sold $3 billion worth of assets in Asia in December and slashed jobs globally to raise the cash needed to keep its dividend up.
But while Chevron was reeling, this stock is ready to soar. Here's the oil stock to buy instead of Chevron...
This Is the Oil Stock to Own in 2017
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Plains All American Pipeline LP (NYSE: PAA) is primed to grow from America's new oil boom.
Plains All American runs pipelines across North America, and it can handle over 4 million barrels of oil and gas a day.
As oil prices rise and restrictions on oil companies are eased, PAA's pipelines will be in heavy demand. That's why their stock is already up 68% since this time last year.
PAA stock currently trades at $31.73. And it's going even higher in 2017.
In a survey of 19 financial analysts by Yahoo Finance, the top-level prediction for PAA's EPS growth in 2017 is 91%. That means analysts are expecting big earnings from the oil transportation company this year.
And while Chevron has been selling assets to maintain its dividend yield of 3.79%, PAA is currently paying a dividend yield of 7%.
Oil prices aren't going to be the only energy story in 2017. In fact, Moors says Brexit is going to cause a major energy problem in Europe. Here's what you need to know about the energy crisis about to hit the United Kingdom...