Jefferies analyst Lloyd Byrne has maintained their neutral stance on OXY stock, giving a Hold rating today.
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Lloyd Byrne has given his Hold rating due to a combination of factors influencing Occidental Petroleum’s financial outlook. The recent divestiture of OxyChem, while addressing market concerns about debt and strategic direction, resulted in a marginally dilutive effect on the company’s earnings. The sale, priced at $9.75 billion, is slightly below investor expectations and leads to a 5% cash flow per share dilution, despite generating significant interest savings.
Additionally, the decision to stack cash for retiring preferred shares by 2029, rather than accelerating returns, suggests a cautious approach in a volatile macroeconomic environment. The retention of environmental liabilities from the OxyChem acquisition further complicates the company’s financial landscape, with substantial future expenditures anticipated. These factors contribute to a balanced outlook, justifying the Hold rating as Occidental navigates these strategic and financial challenges.
In another report released today, Morgan Stanley also maintained a Hold rating on the stock with a $52.00 price target.
OXY’s price has also changed moderately for the past six months – from $49.330 to $44.230, which is a -10.34% drop .