Latest news with #Occidental Petroleum
Yahoo
4 days ago
- Business
- Yahoo
This Top Warren Buffett Stock Continues to Deliver an Impressive Performance
Key Points Occidental Petroleum is one of Berkshire Hathaway's largest holdings. The oil company recently reported solid second-quarter results. It's making excellent progress on its plans to repay debt and grow shareholder value. 10 stocks we like better than Occidental Petroleum › Warren Buffett's company, Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B), continues to be a big believer in Occidental Petroleum (NYSE: OXY). It's easy to see why when looking at the oil giant's recently reported second-quarter results. The company delivered strong performance across the board despite lower oil and gas prices during the period. This consistent execution, even amid market volatility, gives Occidental Petroleum a solid foundation to grow shareholder value for Berkshire Hathaway and other investors in the years ahead. Drilling down into Occidental Petroleum's second-quarter results Occidental Petroleum produced $396 million, or $0.39 per share, of adjusted income during the second quarter. That was down from the $860 million, or $0.87 per share, it earned in the first quarter. The culprit was lower commodity prices. Occidental posted $934 million of pre-tax income in its oil and gas segment, down from $1.7 billion in the first quarter, due primarily to lower oil and gas prices. The average global price of crude oil was 10% below the first quarter's level, while the price of domestic natural gas tumbled 45%. Despite these lower prices, Occidental delivered higher volumes and strong results from its midstream and marketing segment. The company produced 1.4 million barrels of oil equivalent (BOE) per day, exceeding the mid-point of its guidance, while midstream and marketing earnings came in above the high-end of expectations. The company's chemicals business (OxyChem) also delivered solid results that were on par with its first-quarter performance. Additionally, strong well performance and enhanced operational efficiency supported robust cash generation. Operating cash flow before working capital adjustments was $2.6 billion, and free cash flow totaled $700 million, both slightly lower than the previous quarter. More progress on its debt-reduction plan Occidental Petroleum used its healthy free cash flow to pay its dividend and reduce debt. The company also continued to sell noncore assets to accelerate its debt-reduction efforts. It has secured $950 million of additional asset sales since the start of the second quarter. Those sales included $370 million of noncore and select non-operating Permian Basin upstream assets that closed during the quarter. Occidental also recently agreed to sell some gas-gathering assets in the Midland Basin to midstream company Enterprise Products Partners for $580 million. Those sales added to the $1.3 billion of noncore-asset sales it closed during the first quarter. The company has now agreed to sell $4 billion of assets since announcing its deal for CrownRock in late 2023, which has it closing in on the low end of its $4.5 billion to $6 billion target range. The energy company has used a combination of excess free cash and asset-sale proceeds to repay $3 billion of debt so far this year. Since July 2024, it has retired $7.5 billion of debt, saving it $410 million in annual interest expenses. The company has now significantly exceeded its target of delivering at least $4.5 billion of debt reduction within a year of closing its CrownRock deal. More positive catalysts ahead Occidental expects to continue using its excess free cash flow after paying dividends and noncore-asset sales to repay debt. It still has approximately $1.6 billion of 2026 debt maturities to address, as well as another $1.5 billion coming due in 2027. The company shouldn't have a problem paying off that debt, given the anticipated surge in its free cash flow from non-oil sources. The company estimates that a combination of interest expense savings, incremental earnings from upcoming chemicals projects, and midstream contract expirations will boost its free cash flow by $1 billion in 2026 and by an additional $500 million in 2027. As its debt continues to fall, Occidental will be positioned to return more cash to investors, beyond its dividend. It plans to eventually resume share repurchases and the redemption of Berkshire's preferred equity investment that it made in 2019 to support the company's acquisition of Anadarko Petroleum. A well-oiled machine Warren Buffett's Berkshire Hathaway has made a major bet on Occidental's ability to execute its plans to grow shareholder value. The company owns nearly 27% of the oil company's outstanding shares. That position is worth almost $12 billion (approximately 4% of Berkshire's investment portfolio), making it the seventh-largest holding. Occidental's strong second-quarter showing and progress on its debt-reduction plan prove that Buffett's company has made a smart investment. The oil company is in an excellent position to grow shareholder value in the future, despite the continued volatility of crude oil prices. Should you buy stock in Occidental Petroleum right now? Before you buy stock in Occidental Petroleum, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Occidental Petroleum wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $653,427!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $1,119,863!* Now, it's worth noting Stock Advisor's total average return is 1,060% — a market-crushing outperformance compared to 182% for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. See the 10 stocks » *Stock Advisor returns as of August 4, 2025 Matt DiLallo has positions in Berkshire Hathaway and Enterprise Products Partners. The Motley Fool has positions in and recommends Berkshire Hathaway. The Motley Fool recommends Enterprise Products Partners and Occidental Petroleum. The Motley Fool has a disclosure policy. This Top Warren Buffett Stock Continues to Deliver an Impressive Performance was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Globe and Mail
5 days ago
- Business
- Globe and Mail
CFRA Sticks to Their Hold Rating for Occidental Petroleum (OXY)
CFRA analyst Stewart Glickman maintained a Hold rating on Occidental Petroleum today and set a price target of $50.00. The company's shares closed today at $44.32. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. According to TipRanks, Glickman is a 3-star analyst with an average return of 8.4% and a 57.45% success rate. Glickman covers the Energy sector, focusing on stocks such as APA, Occidental Petroleum, and Patterson-UTI. The word on The Street in general, suggests a Hold analyst consensus rating for Occidental Petroleum with a $47.18 average price target, which is a 6.45% upside from current levels. In a report released yesterday, Scotiabank also maintained a Hold rating on the stock with a $45.00 price target. Based on Occidental Petroleum's latest earnings release for the quarter ending March 31, the company reported a quarterly revenue of $6.8 billion and a net profit of $936 million. In comparison, last year the company earned a revenue of $5.98 billion and had a net profit of $888 million
Yahoo
07-08-2025
- Business
- Yahoo
Oxy Sells Permian Assets Valued at $950MM to Reduce Debt
Occidental Petroleum is selling off non-core assets and pushing forward in its debt reduction plan, with four Permian Basin deals valued at $950 million during the second and early third quarters. Between April and July 2025, Occidental (Oxy) completed multiple transactions totaling approximately $370 million, divesting non-core and certain non-operated Permian Basin upstream assets that are not within the company's near-term development plan, according to an Aug. 6 news release. Oxy didn't disclose the buyers. Oxy agreed in July with an affiliate of Enterprise Products Partners (EPD) to sell an entity that owns certain gas gathering assets in the Midland Basin for $580 million. The deal is subject to customary closing conditions and regulatory approval, including the expiration or termination of the Hart-Scott-Rodino Act waiting period, and is expected to close in the third quarter. In February 2024, EPD announced several acquisitions with Western Midstream Partners on Feb. 22, days after reports that Occidental Petroleum, which owns Western Midstream, was looking to sell some Permian assets. Since its December 2023 announcement that it would buy CrownRock, Oxy has made divestitures close to $4 billion. During the last 12 months, Occidental has repaid $7.5 billion of debt, including proceeds from non-core Delaware Basin transactions that closed in April and July, and expects to apply an additional $580 million to debt reduction upon closing of the Midland Basin gas gathering divestiture. "We are pleased with how we continue to strategically strengthen our portfolio, and it's rewarding to see those efforts drive debt reduction and create value for shareholders," Vicki Hollub, Oxy's president and CEO, said in the news release. "We believe Occidental has the best assets in our history and we will continue to find opportunities to high-grade our portfolio and generate long-term value." Oxy executives said this time last year that the firm intended to reduce debt by up to $6 billion within 18 months of the $12 billion CrownRock close. Oxy reported in its quarterly 10-Q filing with the U.S. Securities and Exchange Commission (SEC) that in July, the firm agreed to sell gas gathering assets in the Permian Basin for approximately $580 million. Since the beginning of the year and through the form filing date on Aug. 6, Oxy has sold non-core proved and unproved U.S. onshore oil and gas working interests valued at $730 million. During the first quarter, Oxy sold $900 million worth of non-operated proved and unproved royalty and mineral interests in the Denver-Julesburg Basin. The difference in the assets' net book value and adjusted purchase price was treated as a normal retirement, and as a result no gain or loss was recognized.
