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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 $42.29, marking a -1.47% move from the previous day. This change lagged the S&P 500's daily gain of 0.19%. Meanwhile, the Dow lost 0.11%, and the Nasdaq, a tech-heavy index, added 0.81%.

Coming into today, shares of the oil and gas exploration and production company had lost 5.32% in the past month. In that same time, the Oils-Energy sector lost 1.68%, while the S&P 500 gained 0.56%.

OXY will be looking to display strength as it nears its next earnings release, which is expected to be November 4, 2019. The company is expected to report EPS of $0.41, down 76.84% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $5.29 billion, down 14.32% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $2.47 per share and revenue of $20.48 billion, which would represent changes of -50.7% and +8.44%, respectively, from the prior year.

Any recent changes to analyst estimates for OXY should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 15.62% lower within the past month. OXY is currently a Zacks Rank #5 (Strong Sell).

Valuation is also important, so investors should note that OXY has a Forward P/E ratio of 17.41 right now. This valuation marks a premium compared to its industry's average Forward P/E of 15.39.

Investors should also note that OXY has a PEG ratio of 3.48 right now. 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. The Oil and Gas - Integrated - United States industry currently had an average PEG ratio of 1.99 as of yesterday's close.

The Oil and Gas - Integrated - United States industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 222, putting it in the bottom 13% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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