NEW YORK (TheStreet) -- On Wednesday, TheStreet's Jim Cramer and Stephanie Link, co-managers of the Action Alerts PLUS portfolio, stepped up their investment in the energy sector by purchasing shares of Chevron (CVX).
The stock is off roughly 9% in 2014, after underperforming the broader market in 2013, returning 17%. But the duo can afford to wait. As they pointed out, "the company has increased its dividend for 26 years in a row and at its current price the stock yields an attractive 3.5%," with an increase expected in April.
Concerns come from the most recent earnings report, which revealed a top and bottom line miss where sales fell more than 7% year-over-year. Additionally, the company's CAPEX spending was relatively high and production dropped 3.5%.
However, Link reasoned that the investments the company is making will begin to payoff in the second half of 2014.
So why invest now?
Along with the stock trading at a discount to its peers, with a price-to-earnings ratio of 10.4 versus 10.9, they view the upcoming earnings release on April 9 and analyst day on March 11 as positive catalysts in the short-term, along with a potential dividend hike as well.
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DISCLOSURE: At the time of publication, Cramer's Action Alerts PLUS portfolio had a long position in CVX.
-- Written by Bret Kenwell in Petoskey, Mich.