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Occidental Petroleum (OXY) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Occidental Petroleum (OXY) closed at $44.60, marking a -1.22% move from the previous day. This move lagged the S&P 500's daily gain of 0.03%. At the same time, the Dow added 0.13%, and the tech-heavy Nasdaq lost 0.11%.

Prior to today's trading, shares of the oil and gas exploration and production company had lost 0.24% over the past month. This has lagged the Oils-Energy sector's gain of 8.57% and the S&P 500's gain of 4.17% in that time.

OXY will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.63, down 64.41% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.06 billion, down 18.05% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.90 per share and revenue of $20.79 billion, which would represent changes of -42.12% and +10.09%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for OXY. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 7.82% lower within the past month. OXY currently has a Zacks Rank of #4 (Sell).

In terms of valuation, OXY is currently trading at a Forward P/E ratio of 15.56. This valuation marks a discount compared to its industry's average Forward P/E of 15.74.

It is also worth noting that OXY currently has a PEG ratio of 3.11. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. OXY's industry had an average PEG ratio of 2.11 as of yesterday's close.

The Oil and Gas - Integrated - United States industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 204, which puts it in the bottom 21% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow OXY in the coming trading sessions, be sure to utilize Zacks.com.

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