Update on my Chevron (CVX) position — Reasons for holding and key risks

I'd like to share an update on my position in Chevron Corporation $CVX, which currently represents 4.2% of my total portfolio. The target price is set at approximately $187, offering potential capital appreciation along with an attractive dividend yield (historically around 4%).

Three main reasons I continue to hold CVX:

1. Reliable and growing dividend income: Chevron is a Dividend Aristocrat with a long history of raising its dividend annually. The current yield provides steady income that significantly boosts total returns over long-term holding.

2. Strong operational diversification and financial discipline: As a major energy company, Chevron generates robust cash flow from production, supported by a conservative balance sheet and low leverage.

3. Attractive valuation with upside potential toward the target price: With the current price below the $187 target level, there is reasonable room for capital appreciation, which, combined with a high dividend yield, creates a favorable risk-reward profile.

Two key risks that could threaten the investment:

1. Volatility in oil and natural gas prices: CVX's revenues and cash flow are highly sensitive to commodity price swings. A prolonged decline in oil prices could negatively impact profitability and the sustainability of dividends.

2. Regulatory and energy transition challenges: Increasing climate regulations, potential carbon taxes, and the global shift toward renewable energy could, over the long term, threaten the traditional business model in the oil and gas sector.

Overall, I remain bullish in the medium term, but I’m closely monitoring developments in the oil market and macroeconomic factors.

Do you hold CVX shares? What is your target price or your view on the balance between dividend yield and growth potential?