NEW YORK (TheStreet) -- Shares of Chevron Corp. (CVX) are lower by 1.01% to $124.93 in mid-afternoon trading on Tuesday, following a ratings downgrade to "underperform" from "neutral" at Bank of America (BAC) .
The firm said it reduced its rating on the petroleum company as it believes the company is facing a "more challenging outlook for free cash flow, given current net cash outflow which looks to remain above $50 billion."
"While planned disposals suggested by management could top ~$10 billion our analysis suggests that Chevron will build material debt over the next four years, consistent with the ~$12 billion annual run rate evident over the past year," the firm continued.STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.
Bank of America cut its price target on Chevron to $133 from $135.
Separately, TheStreet Ratings team rates CHEVRON CORP as a Buy with a ratings score of A-. TheStreet Ratings Team has this to say about their recommendation:
"We rate CHEVRON CORP (CVX) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, attractive valuation levels, largely solid financial position with reasonable debt levels by most measures, increase in net income and increase in stock price during the past year. We feel these strengths outweigh the fact that the company has had somewhat disappointing return on equity."