Investors in Chevron Corporation (NYSE:CVX) had a wonderful 2016. Last year started with CVX stock lingering around $80 per share. Chevron stock then rallied as much as 40% over the course of the year, and it now sits at $115 per share in 2017.

The rebound in oil and natural gas prices played a big role. Investors are looking more optimistically toward the future of fossil fuels. Trump’s election victory also helped, as we should expect a more vigorous domestic energy industry going forward.

And after a long delay, Chevron bumped up its dividend again. But with CVX shares nearing their all-time highs, will the party end soon?

Let’s look at the risks.

CVX Stock Cons

Dividend in Danger: Yield investors love CVX stock for the large dividend — it has been reliable throughout the years. However, that dividend may be living on borrowed time. The company isn’t coming close to being able to fund the dividend out of continuing operations at present.

Through the first nine months of 2016, Chevron spent $14 billion on capital expenditures. These come in two categories: growth and maintenance. Growth is whatever drives new production in the future; new wells, technical improvements to existing ones, asset purchases and so on. Maintenance is necessary to merely keep existing production going safely. That $14 billion greatly exceeded the company’s $9 billion over that same stretch that it earned from its operations. Thus, simply to go about normal business, it ran a $5 billion deficit.

On top of that CVX paid $6 billion in dividends. With what funds, you might ask? Through the end of Q3, Chevron had borrowed $7 billion in new debt to increase its cash position. You can see the danger in borrowing $7 billion in order to pay $6 billion in dividends. The dividend is coming from the generosity of lenders, not the company’s business operations. If oil prices rally sharply, this problems fixes itself. But, if not…

What Upside Is Left? Between 2012 and the summer of 2014, CVX stock regularly traded around $115 per share give or take a few bucks. Today, we’re back at $115 per share of Chevron stock. However, back then, oil traded around $90 per barrel. Today, we’re between $50 and $55 for that same barrel. Natural gas prices haven’t improved much over that span either.

Between 2010 and 2013, Chevron stock routinely traded with a sub-12 price-to-earnings ratio. Oftentimes, CVX stock traded with a single-digit P/E. Oil companies simply don’t deserve to trade at rich valuation ratios. Their reserves always need to be replaced, there are huge capital expenditure costs and regulatory burdens and environmental issues are always a risk. And that’s before we even get to oil prices.

If oil magically returned to $80 per barrel tomorrow, Chevron stock would still be overvalued to its recent history. The company hasn’t made any notable advances since 2012 that would justify the huge run-up in valuation while oil prices tanked.

Peers Look More Attractive: The case for CVX stock becomes even more difficult when you look at its peers. Almost every strength it has is outmatched by a peer. If you like Chevron stock for the dividend, Exxon Mobil Corporation (NYSE:XOM) is a better choice. CVX stock yields 3.7% and Exxon pays 3.5%, but in return for just 0.2% less yield, you get a far stronger balance sheet, a more diversified business with more insulation from oil prices and a company whose ex-CEO will likely be the U.S. Secretary of State. That’s a lot of perks in return for 0.2% yield.

On the other end of the spectrum, oil companies that already cut their dividends in recent years have more upside than Chevron. ConocoPhillips (NYSE:COP) cut its dividend and was rewarded with a gigantic stock price decline. With the dividend players out of the stock, there’s far more value in shares today, as it languishes far below all-time highs. International oil giants such as BP plc (ADR) (NYSE:BP) also look much more attractive on a valuation basis.

CVX Stock Pros

Gorgon Could Impress: Chevron’s gigantic Gorgon LNG project in Australia is back in operation. CVX owns 47% of this $54 billion project, making it a key factor in Chevron’s future growth potential.

Gorgon started production last year, but it has been met with numerous outages. One of the two production facilities was just offline from late November through the end of the year, but it is now operational again. Investors will want to see positive results from Gorgon soon. It was delayed and came in way over budget.

Chevron has another LNG mega-project, Wheatstone, also over budget, which should start delivering production later this year. CVX stock could rally further if these projects can finally impress the skeptics.

It Remains a Dividend Champion: Chevron stock has paid increasing dividends every year since 1987. Many investors, particularly within the Dividend Growth Investing “DGI” school of thought, only buy stocks that have long track records of raising their dividend each year. These same investors generally sell a stock as soon as it fails to increase its dividend on a year-over-year basis.

Chevron was in danger of losing this streak. The company had last increased its dividend following Q1 of 2014. It paid $4.21 in total dividends in 2014. Despite not raising the dividend during 2015, the total payments rose to $4.28 for 2015, as that Q1 2015 payment topped 2014’s by 7 cents. Through most of 2016, however, there were no dividend hikes, suggesting CVX couldn’t keep the streak alive. However, for Q4, the company raised the dividend by a token penny. It still counts, as the company paid $4.29 for 2016 versus $4.28 in 2015, and thus its status — and legion of people who buy due the dividend – is maintained.

Oil Prices Recovering: While the price of oil is still far off 2010 to 2014 levels, it has improved. Last year, we were discussing the possibility of oil lingering in the 30s for a long period of time. Now, instead, we find oil topping $50 per barrel. Natural gas has also recovered sharply over the past year.

The current price of oil isn’t high enough to support Chevron’s dividend or CVX stock at its present price. But oil is now trending in the right direction. OPEC appears to be making more serious moves. The fall in oil curtailed fracking production to at least some degree. And oil has held up reasonably well despite renewed strength in the dollar since Trump was elected. Overall, there’s reason for cautious optimism on crude.

Bottom Line on Chevron Stock

I can’t endorse CVX stock at current prices. The valuation assumes that oil rallies sharply, Chevron trades as though it’s 2014 and oil is still $90 per barrel. A large part of the shareholder base is content since Chevron continues to increase the dividend. But without actual cash flow generation to support said dividend, this is but a small comfort. I see limited upside for CVX stock even if oil rallies. And if oil drops back under $40, Chevron stock should get hammered.

At the time of this writing, Ian Bezek had no positions in any of the aforementioned stocks. You can reach him on Twitter at @irbezek.