HSBC analyst Samantha Hoh upgraded the rating on Occidental Petroleum to a Buy today, setting a price target of $55.00.
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Samantha Hoh’s rating is based on Occidental Petroleum’s strategic initiatives that are expected to significantly enhance shareholder value. The company’s decision to sell its chemical business to Berkshire Hathaway is anticipated to accelerate debt reduction and advance share buybacks, which are key factors in improving financial stability and returning value to shareholders. Additionally, Occidental’s alignment of its Oil & Gas operations with Midstream is projected to unlock further value through enhanced recovery technologies and integrated CO2 and power solutions.
Furthermore, the divestment of OxyChem is expected to generate substantial cash flow, allowing Occidental to resume share repurchases earlier than initially planned. This move, coupled with the company’s commitment to a sustainable and growing dividend, positions it to generate significant free cash flow in the coming years. The recent pullback in Occidental’s share price, following the OxyChem sale announcement, presents a compelling buying opportunity, with an upgraded target price reflecting a notable upside potential.