Occidental Petroleum (OXY) AI Stock Analysis

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Occidental Petroleum

(NYSE:OXY)

72Outperform

Occidental Petroleum's overall score reflects its strong financial management and cash flow generation, despite declining revenue and bearish technical indicators. The company has a reasonable valuation and positive earnings call highlights, suggesting potential for long-term growth. Recent corporate events also indicate strong governance and shareholder confidence, although technical indicators suggest caution in the short term.

Positive Factors

Debt Management

Occidental has repaid $2.3 billion of debt, which includes all of their 2025 maturities, providing them with headroom in the current environment.

Financial Performance

Occidental reported strong headline 1Q25 results, driven by outperforming midstream guidance and lower Lease Operating Expenses.

Operational Efficiency

Efficiency gains in the Permian EOR business and lower carbon costs have allowed Occidental to lower their Lease Operating Expense guidance.

Negative Factors

Cash Flow Concerns

OXY's cash flow profile becomes less attractive as the company continues to spend growth capital outside their E&P business all the while maintaining higher leverage compared to large cap peers.

Leverage Concerns

OXY assumed a significant amount of debt to acquire the acreage, increasing pro-forma leverage, with a goal to reach sub-1x leverage only by mid-2027.

Production Challenges

OXY saw another year of decline in the Delaware where they still produce 70% of oil volumes, with productivity per foot declining compared to peers that saw productivity growth.

Occidental Petroleum (OXY) vs. S&P 500 (SPY)

Market Cap

$38.16B

Dividend Yield2.29%

Average Volume (3M)14.18M

Price to Earnings (P/E)16.6

Beta (1Y)0.52

Revenue Growth-4.35%

EPS Growth-37.69%

CountryUS

Employees13,323

SectorEnergy

Sector Strength47

IndustryOil & Gas Exploration & Production

Share Statistics

EPS (TTM)0.87

Shares Outstanding939,782,530

10 Day Avg. Volume9,282,853

30 Day Avg. Volume14,184,799

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.00

Price to Cash Flow (P/CF)0.00

P/FCF Ratio0.00

Enterprise Value/Market Cap2.10

Enterprise Value/RevenueN/A

Enterprise Value/Gross Profit3.03

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$48.83

Price Target Upside17.83% Upside

Rating ConsensusHold

Number of Analyst Covering20

Occidental Petroleum Business Overview & Revenue Model

Company DescriptionOccidental Petroleum Corporation (OXY) is a leading international energy company, engaged primarily in the exploration and production of crude oil and natural gas. The company operates through three main segments: Oil and Gas, Chemical, and Midstream and Marketing. Its Oil and Gas segment is focused on the exploration, development, and production of oil and gas properties, primarily in the United States, the Middle East, and Latin America. The Chemical segment, known as OxyChem, manufactures and markets basic chemicals and vinyls. The Midstream and Marketing segment is involved in the transportation and marketing of oil and gas, as well as power generation.

How the Company Makes MoneyOccidental Petroleum generates revenue through its three primary business segments. The Oil and Gas segment is the largest revenue contributor, where the company explores for and produces crude oil and natural gas, selling these commodities in the global market. Revenue from this segment is heavily influenced by fluctuations in oil and gas prices and production volumes. The Chemical segment, OxyChem, generates revenue by producing and selling chemicals such as chlorine, caustic soda, and polyvinyl chloride (PVC) resins, which are used in various industrial applications. The Midstream and Marketing segment adds to the company's revenue by providing transportation, storage, and marketing services for oil and gas, as well as generating power. Strategic partnerships and joint ventures, as well as efficiency improvements and technological advancements, also play a significant role in enhancing Occidental's profitability.

Occidental Petroleum Key Performance Indicators (KPIs)

Any

Production by Geography

Production by Geography
Shows oil and gas production levels across different regions, highlighting where Occidental Petroleum is most active and potentially more profitable, while also indicating geopolitical risks and opportunities.

Chart InsightsOccidental Petroleum's US production surged in late 2024, hitting record levels, driven by strategic investments in high-return assets. This aligns with the company's earnings call, highlighting a focus on short-cycle projects and operational efficiencies. Despite weather-related challenges impacting international output, the overall production outlook remains strong, with expected growth in 2025. The company's strategic focus on debt reduction and cash flow generation further supports its robust financial position, while environmental liabilities and midstream earnings declines pose potential risks.

Data provided by:

Main Street Data

Occidental Petroleum Financial Statement Overview

Summary

Occidental Petroleum showcases a robust cash flow position and stable balance sheet management, which are crucial for long-term sustainability. While income statement metrics show profitability, declining revenue and margins pose potential risks. The company should focus on boosting revenue and optimizing operational efficiencies to enhance financial health.

Income Statement

Positive

Occidental Petroleum's income statement exhibits a mixed performance. The gross profit margin and net profit margin have shown improvement in recent years, indicating better cost management and profitability. However, revenue has seen a decline from 2022 to 2024, which is a concern. The EBIT and EBITDA margins have also decreased, reflecting potential operational inefficiencies or market challenges.

Balance Sheet

Positive

The balance sheet reveals a relatively stable equity position with improving debt-to-equity ratios over the years, reflecting effective debt management. However, total assets have decreased, and the equity ratio is impacted by substantial liabilities. The return on equity has fluctuated, with a decline in recent years, indicating challenges in generating returns for shareholders.

Cash Flow

Positive

Occidental Petroleum's cash flow analysis highlights strong operating cash flow generation, which is a positive indicator of its core business strength. The free cash flow has been more volatile, but recent trends show improvement. The operating cash flow to net income ratio is strong, suggesting efficient conversion of earnings into cash.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
26.73B	28.26B	36.63B	25.96B	17.81B
	Gross Profit
26.39B	10.11B	17.64B	7.85B	1.24B
	EBIT
2.90B	5.97B	14.61B	5.46B	-770.00M
	EBITDA
12.62B	14.54B	22.07B	13.89B	-6.14B
	Net Income Common Stockholders
2.38B	4.70B	13.30B	2.32B	-13.53B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
2.13B	1.43B	984.00M	2.76B	2.01B
	Total Assets
85.44B	74.01B	72.61B	75.04B	80.06B
	Total Debt
1.51B	20.91B	20.77B	30.39B	37.30B
	Net Debt
1.51B	19.48B	19.78B	27.62B	35.29B
	Total Liabilities
50.97B	43.66B	42.52B	54.71B	61.49B
	Stockholders Equity
34.16B	30.25B	30.09B	20.33B	18.57B
Cash Flow		Free Cash Flow
4.42B	6.06B	12.46B	7.48B	788.00M
	Operating Cash Flow
11.44B	12.31B	16.81B	10.25B	3.84B
	Investing Cash Flow
-14.59B	-6.98B	-4.87B	-1.17B	-778.00M
	Financing Cash Flow
3.84B	-4.89B	-13.71B	-8.56B	-4.51B

Occidental Petroleum Technical Analysis

Technical Analysis Sentiment

Neutral

Last Price41.44

Price Trends

50DMA

43.55

Negative

100DMA

46.19

Negative

200DMA

49.48

Negative

Market Momentum

MACD

-0.93

Negative

RSI

51.66

Neutral

STOCH

40.33

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For OXY, the sentiment is Neutral. The current price of 41.44 is above the 20-day moving average (MA) of 39.37, below the 50-day MA of 43.55, and below the 200-day MA of 49.48, indicating a neutral trend. The MACD of -0.93 indicates Negative momentum. The RSI at 51.66 is Neutral, neither overbought nor oversold. The STOCH value of 40.33 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for OXY.

Occidental Petroleum Peers Comparison

Overall Rating

UnderperformOutperform

Sector (56)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
EOG	81 Outperform	$60.51B	10.29	20.90%	3.47%	-0.23%	-14.82%
COP	78 Outperform	$110.78B	11.22	16.16%	3.56%	-2.57%	-14.01%
FANG	75 Outperform	$38.81B	8.14	14.26%	4.71%	47.89%	-7.75%
DVN	73 Outperform	$19.68B	6.72	20.88%	4.13%	13.25%	-16.37%
OXY	72 Outperform	$38.16B	16.61	9.43%	2.29%	-4.35%	-37.69%
HES	71 Outperform	$39.86B	17.84	20.82%	1.50%	8.08%	―
Sector *	56 Neutral	$6.93B	3.23	-4.86%	5.94%	0.12%	-48.32%

* Energy Sector Average

Performance Comparison

OXY

Occidental Petroleum

41.44

-21.68

-34.35%

COP

Conocophillips

88.82

-31.09

-25.93%

DVN

Devon Energy

31.93

-17.30

-35.14%

EOG

EOG Resources

109.71

-16.95

-13.38%

HES

Hess

130.88

-26.86

-17.03%

FANG

Diamondback

136.18

-60.76

-30.85%

Occidental Petroleum Earnings Call Summary

Earnings Call Date:May 07, 2025

(Q1-2025)

% Change Since: 6.23%|

Next Earnings Date:Aug 05, 2025

Earnings Call Sentiment Positive

Occidental reported strong operational efficiency and cash flow with significant debt reduction and promising developments in Oman. Despite challenges such as market volatility, commodity price pressures, and chemical business headwinds, the company's strategic focus on cost management and carbon management initiatives provides a solid foundation for future growth.

Q1-2025 Updates

Positive Updates

Strong Cash Flow and Operational Efficiency

Generated $3 billion in operating cash flow before working capital in Q1 2025. Domestic oil and gas operating cost of $9.05 per BOE came in substantially below expectations.

Improvements in Drilling Efficiency

Achieved a 15% improvement in drilling duration per well in the Permian, with a more than 10% reduction in well costs compared to last year.

Significant Debt Reduction

Retired $2.3 billion in debt year-to-date, reducing annual interest expense by $370 million. Over the past 10 months, repaid a total of $6.8 billion.

Oman Contract Extension and Discoveries

In advanced negotiations to extend Block 53 contract by 15 years, unlocking over 800 million barrels of resources. Recent significant gas and condensate discovery in North Oman with estimated resources exceeding 250 million barrels of oil equivalent.

Midstream and Marketing Outperformance

Midstream business outperformed the high end of guidance range due to strong gas marketing optimization and healthy sulfur market.

Carbon Management Milestone

Signed a 25-year carbon offtake agreement supporting the storage of approximately 2.3 million metric tons of CO2 annually, illustrating demand for large-scale carbon management solutions.

Negative Updates

Uncertainty in the Market Environment

Commodity price volatility due to demand, policy, and supply uncertainties. Pressure from OPEC+ volumes and economic conditions.

Chemical Business Challenges

OxyChem faced operational challenges due to winter weather, impacting production and increasing raw material costs.

Macroeconomic Headwinds

Concerns about global trade, tech trade and tariffs, and the economic impact of potential recessions.

Company Guidance

During Occidental's First Quarter 2025 Earnings Conference Call, the company provided detailed guidance on several key metrics. The oil and gas segment achieved a production rate of just over 1.39 million barrels of oil equivalent (BOE) per day, aligning with the midpoint of their guidance. Operating costs for domestic oil and gas came in at $9.05 per BOE, significantly below expectations. In the Permian Basin, drilling efficiency improved by 15% year-over-year, leading to a 10% reduction in unconventional well costs. This efficiency allowed Occidental to reduce its rig count while still expecting increased production. The company also announced advanced negotiations to extend the Block 53 contract in Oman, potentially unlocking over 800 million gross barrels of additional resources. Occidental's midstream and marketing business outperformed expectations, driven by gas marketing optimization. The OxyChem segment exceeded expectations, delivering $215 million on an adjusted basis despite operational challenges. Looking ahead, the company has reduced its 2025 capital guidance by $200 million and projects $150 million in operational expense savings, aiming to enhance financial resilience amidst market volatility.

Occidental Petroleum Corporate Events

Executive/Board ChangesShareholder MeetingsBusiness Operations and Strategy

Occidental Petroleum Elects Board, Amends Incentive Plan

Positive

May 6, 2025

At the 2025 Annual Meeting of Shareholders held on May 2, 2025, Occidental Petroleum Corporation successfully elected ten board nominees, approved executive compensation, ratified KPMG as its independent auditor, and amended its Long-Term Incentive Plan. These decisions reflect strong shareholder support and are expected to influence the company’s strategic direction and governance positively.

Spark’s Take on OXY Stock

According to Spark, TipRanks’ AI Analyst, OXY is a Neutral.

Occidental Petroleum’s overall score reflects strong financial management, robust cash flows, and successful debt reduction strategies. However, declining revenue and bearish technical indicators temper the outlook. The company’s valuation remains reasonable with an attractive dividend yield, and positive earnings call highlights suggest long-term growth potential despite current challenges.

To see Spark’s full report on OXY stock, click here.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.