Key Takeaways
- Chevron’s third-quarter 2026 earnings nearly tripled to $9.9 billion, and TC Energy raised its 2026 outlook for comparable EBITDA.
- TC Energy yields 3.9% and Chevron 3.4%, but Chevron grew its dividend 6% a year from fiscal 2020 to fiscal 2025, against 1% for TC Energy.
- TC Energy’s distributable cash flow covered its dividend 2.0x in fiscal 2025, and Chevron paid out 41% of its free cash flow over the twelve months to Sept. 30, 2026.
- Chevron carries far less debt, at 0.4x EBITDA against 6.0x for TC Energy.
Chevron (CVX) reported $9.9 billion of third-quarter earnings on Oct. 30, nearly triple the $3.5 billion it earned a year before. TC Energy (TRP) followed on Nov. 5 by raising its 2026 outlook for comparable EBITDA to C$11.8 billion to C$12.0 billion.
Both dividends look solid, but on very different footing: Chevron’s depends on oil and gas prices, and TC Energy’s on long-term contracts to move natural gas for LNG exports, data centers and power plants. Only one gets my dividend dollars for the next 10 years. Here’s how they stack up:
| Metric | TC Energy (TRP) | Chevron (CVX) |
|---|---|---|
| Dividend yield | 3.9% | 3.4% |
| Annual dividend at the current rate | C$3.51 | $7.12 |
| Dividend growth, fiscal 2020-2025 | 1.0% a year | 5.8% a year |
| Record (company’s own count) | 26 consecutive years of dividend growth | 39 consecutive years of raises |
| Coverage, last reported | 2.0x distributable cash flow coverage (fiscal 2025) | 41% cash dividend payout ratio (TTM to Sept. 30, 2026) |
| Net debt/EBITDA | 6.0x | 0.4x |
| Interest coverage | 2.1x | 25.1x |
Source: TIKR; dividend rates and records from each company’s release and call. Yields at today’s prices.
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TC Energy is building again
TC Energy expects comparable EBITDA of C$12.3 billion to C$12.5 billion in 2027, and 5% to 7% growth a year over five years. On Nov. 5, it sanctioned pipeline expansions in the US Midwest and Canada, backed by long-term take-or-pay contracts.
Distributable cash flow has covered the dividend in every year since fiscal 2016:
The cushion thinned from 2.4x in fiscal 2018 to 1.2x in fiscal 2024, then widened to a comfortable 2.0x in fiscal 2025. Still, the dividend’s 5-year growth is a slow 1.0% a year, from C$3.24 in fiscal 2020 to C$3.40 in fiscal 2025, against a company target of 3% to 5%.
The dividend is set in Canadian dollars, so the US-dollar check moves with the exchange rate, and Canada withholds tax on dividends paid to US holders.
Debt is the weak spot, with 2027 capital spending planned at C$6.7 billion to C$7.2 billion. CFO Sean O’Donnell said on the third-quarter call: “This is an internally funded plan. No equity, no M&A, no capital rotation needed to achieve this plan if we can deliver as expected.”
Chevron rides the oil cycle
Where TC Energy’s cash comes from contracts, Chevron’s follows prices, and prices helped in the third quarter of 2026. Free cash flow hit $12.0 billion, up from $4.9 billion a year before.
Over the twelve months to Sept. 30, 2026, dividends took a well-covered 41% of free cash flow. The ratio was tighter in the last two fiscal years, at 78.4% in fiscal 2024 and 76.9% in fiscal 2025. Free cash flow swung widely over the past decade, while dividends paid rose from $8.03 billion in fiscal 2016 to $12.8 billion in fiscal 2025:
In fiscal 2020, free cash flow of $1.66 billion fell far short of $9.65 billion of dividends, and Chevron paid them anyway. CFO Eimear Bonner said on the third-quarter call that the first priority is “to grow the dividend consistently.” Volatile prices and the Middle East conflict, both risks Chevron names, can push free cash flow back down.
So which dividend wins?
Chevron gets my dividend dollars for the next 10 years. At each company’s 5-year growth rate, $10,000 in Chevron pays about $4,439 in dividends over the decade, about $365 more than the same $10,000 in TC Energy, whose income is figured in Canadian dollars. Chevron’s yearly income passes TC Energy’s around 2029, and by year 10 its check comes to about $565. Call it a 5.6% yield on today’s cash.
That 5.8% pace leans on prices, given how much of free cash flow the dividend took in the last two fiscal years. It also leans on a balance sheet that kept the dividend growing through fiscal 2020. And Chevron trades at 11x forward earnings, below its 5-year average of 14x:
TC Energy pays the bigger check today, its dividend has plenty of coverage, and its contracted projects back a 3% to 5% growth target that would narrow Chevron’s lead. It’s just that, with that much debt and a big building plan to fund, I trust Chevron’s balance sheet more to carry a dividend through the next 10 years.
Chevron plans to lay out its 2027 capital program in December, after meeting with its board, and that will be the next look at how much room it leaves for raises.
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Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any of the stocks mentioned. Thank you for reading, and happy investing!
