What Our Analysts Know About Occidental Petroleum

Occidental Petroleum logged a 1.63% change Friday, and is now trading at a price of $61.25 per share. The S&P 500 index moved 1.6% and the Nasdaq posted a 2.07% change.

Occidental Petroleum shares moved 9.99% over the last 52 weeks, with a high of $76.82 and a low of $50.73. During this time, the stock outperformed the S&P 500 index by 13.69%. As of January 2022, the company's 50-day average price is $63.0. Occidental Petroleum Corporation is an American company engaged in hydrocarbon exploration in the United States, the Middle East, and Colombia as well as petrochemical manufacturing in the United States, Canada, and Chile. The large-cap Energy company is based in Houston, TX. Occidental Petroleum has returned a 1.21% dividend yield over the last 12 months.

Snapshot of the Company's Operating Margins Consistently Higher Than the 35.55% Industry Average:

2019-12-31 2020-12-31 2021-12-31 2022-12-31
Revenue (MM) $20,911 $17,809 $25,956 $36,634
Revenue Growth n/a -14.83% 45.75% 41.14%
Operating Margins 37.46% 64.36% 73.36% 79.3%
Operating Margins Growth n/a 71.81% 13.98% 8.1%
Net Margins -4.71% -83.28% 8.95% 36.32%
Net Margins Growth n/a -1668.15% 110.75% 305.81%
Earnings Per Share -$0.94 -$13.73 $2.14 $14.78
EPS Growth n/a -1360.64% 115.59% 590.65%
Diluted Shares (MM) 1,044 1,081 1,083 900
Free Cash Flow (MM) $1,020 $1,420 $7,564 $12,313
FCF Growth n/a 39.22% 432.68% 62.78%
Capital Expenditures (MM) $6,355 $2,535 $2,870 $4,497
LT Debt to Equity 1.13 1.93 1.43 0.64

Occidental Petroleum Is Fairly Priced at Current Levels:

Compared to the Energy sector's average of 7.54, Occidental Petroleum has a trailing twelve month P/E ratio of 4.82 and, according to its EPS guidance of 5.68, an expected P/E ratio of 10.78.

Occidental Petroleum's P/B ratio is 3.053 compared to its sector average of 1.68. The company is likely overvalued in terms of its net asset value. The company's shares are currently trading 132.1% above their fair value as expressed by Benjamin Graham's formula:

√(22.5 * 5-year average EPS * book value per share) = √(22.5 * 1.37 * 22.59) = $26.39

Occidental Petroleum's elevated P/B ratio notwithstanding, the company's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued.

Most of the Market Indicators on Occidental Petroleum Are Negative:

26 analysts are following Occidental Petroleum and have set target prices ranging from $60.0 to $93.0 per share. On average, they have given the company a rating of hold. At the current price of $61.25, OXY is trading -17.2% away from its average analyst target price of $73.97 per share, implying an analyst consensus of some upside potential for the stock.

The above analysis is intended for educational purposes only and was performed on the basis of publicly available data. It is not to be construed as a recommendation to buy or sell any security. Any buy, sell, or other recommendations mentioned in the article are direct quotations of consensus recommendations from the analysts covering the stock, and do not represent the opinions of Market Inference or its writers. Past performance, accounting data, and inferences about market position and corporate valuation are not reliable indicators of future price movements. Market Inference does not provide financial advice. Investors should conduct their own review and analysis of any company of interest before making an investment decision.