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Occidental (OXY) Down 2.4% Since Last Earnings Report: Can It Rebound?
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A month has gone by since the last earnings report for Occidental Petroleum (OXY - Free Report) . Shares have lost about 2.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Occidental due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Occidental Q2 Earnings and Revenues Beat Estimates
Occidental Petroleum Corporation reported second-quarter 2021 earnings of 32 cents per share versus the Zacks Consensus Estimate of a breakeven. The company incurred a loss of $1.76 per share in the prior-year quarter.
Total Revenues
Occidental's total revenues were $6,010 million, which surpassed the Zacks Consensus Estimate of $5,847 million by 2.8%. The top line also improved 101.9% from the year-ago quarter. The year-over-year improvement was due to strong contribution from all segments.
Segment Details
Oil and Gas revenues for the quarter were $4,505 million, up 120.8% year over year.
Chemical revenues for the quarter were $1,187 million, up 40.3% year over year.
Midstream & Marketing revenues for the quarter were $497 million, up 143.6% year over year.
Production & Sales
Occidental’s total production volume for the second quarter was 1,203 thousand barrels of oil equivalent per day (Mboe/d), which exceeded the upper end of the guided range of 1,140-1,170 Mboe/d. Strong production volumes were attributed to higher volumes from the Permian Resources region. Permian Resources production for the second quarter was 504 Mboe/d, which exceeded the guided range of 490-500 Mboe/d.
For the quarter under review, total sales volume was 1,199 Mboe/d, down 13.5% from 1,386 Mboe/d recorded in the year-ago period. The decline was due to a drop in U.S. and International sales volumes.
Realized Prices
Second-quarter realized prices for crude oil improved 177.4% year over year to $64.18 per barrel on a worldwide basis. Worldwide realized natural gas liquids prices improved 221.7% from the prior-year quarter to $25.06 per barrel. Worldwide natural gas prices increased 112.7% from the year-ago quarter to $2.34 per thousand cubic feet. Despite a decline in year-over-year sales volume, the company benefited from worldwide improvement in commodity prices.
Highlights of the Release
Occidental’s total expenses for the reported quarter were $5,823 million, down 48.4% year over year.
Out of its planned divestiture of $10.2 billion, the company has already completed $9.2 billion and utilized a major portion of the proceeds to lower outstanding debts.
Interest expenses for the reported quarter were up 24.2% to $385 million from $310 million in the year-ago period.
Financial Position
As of Jun 30, 2021, Occidental had cash and cash equivalents of $4,569 million compared with $2,008 million on Dec 31, 2020.
As of Jun 30, 2021, the company had a long-term debt (net of current portion) of $35,352 million compared with $35,745 million on Dec 31, 2020. The debt level decrease was due to effective management of debt since the acquisition of Anadarko.
For first- half of 2021, cash from operations was $4,224 million, up from $1,699 million in the prior-year period. Free cash flow for the first half of 2021 was $3.6 billion.
For first-half 2021, Occidental’s total capital expenditure was $1,277 million compared with $1,675 million invested in the year-ago period.
Guidance
For third-quarter 2021, it expects production in the range of 1,130-1,160 Mboe/d and output from Permian Resources in the band of 484-494 Mboe/d. The company expects exploration expenses to be $55 million.
For 2021, Occidental expects production to be 1,150 Mboe/d and output from Permian Resources to be 483 Mboe/d. The company expects exploration expenses for 2021 to be $250 million.It expects to invest $2.9 billion in 2021 to further strengthen the existing operations. A total of $2.53 billion was invested in 2020. A major portion of the planned capital expenditure will be directed toward strengthening its oil and gas operations.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 141.8% due to these changes.
VGM Scores
Currently, Occidental has a strong Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Occidental has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.
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Occidental (OXY) Down 2.4% Since Last Earnings Report: Can It Rebound?
A month has gone by since the last earnings report for Occidental Petroleum (OXY - Free Report) . Shares have lost about 2.4% in that time frame, underperforming the S&P 500.
Will the recent negative trend continue leading up to its next earnings release, or is Occidental due for a breakout? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
Occidental Q2 Earnings and Revenues Beat Estimates
Occidental Petroleum Corporation reported second-quarter 2021 earnings of 32 cents per share versus the Zacks Consensus Estimate of a breakeven. The company incurred a loss of $1.76 per share in the prior-year quarter.
Total Revenues
Occidental's total revenues were $6,010 million, which surpassed the Zacks Consensus Estimate of $5,847 million by 2.8%. The top line also improved 101.9% from the year-ago quarter. The year-over-year improvement was due to strong contribution from all segments.
Segment Details
Oil and Gas revenues for the quarter were $4,505 million, up 120.8% year over year.
Chemical revenues for the quarter were $1,187 million, up 40.3% year over year.
Midstream & Marketing revenues for the quarter were $497 million, up 143.6% year over year.
Production & Sales
Occidental’s total production volume for the second quarter was 1,203 thousand barrels of oil equivalent per day (Mboe/d), which exceeded the upper end of the guided range of 1,140-1,170 Mboe/d. Strong production volumes were attributed to higher volumes from the Permian Resources region. Permian Resources production for the second quarter was 504 Mboe/d, which exceeded the guided range of 490-500 Mboe/d.
For the quarter under review, total sales volume was 1,199 Mboe/d, down 13.5% from 1,386 Mboe/d recorded in the year-ago period. The decline was due to a drop in U.S. and International sales volumes.
Realized Prices
Second-quarter realized prices for crude oil improved 177.4% year over year to $64.18 per barrel on a worldwide basis. Worldwide realized natural gas liquids prices improved 221.7% from the prior-year quarter to $25.06 per barrel. Worldwide natural gas prices increased 112.7% from the year-ago quarter to $2.34 per thousand cubic feet. Despite a decline in year-over-year sales volume, the company benefited from worldwide improvement in commodity prices.
Highlights of the Release
Occidental’s total expenses for the reported quarter were $5,823 million, down 48.4% year over year.
Out of its planned divestiture of $10.2 billion, the company has already completed $9.2 billion and utilized a major portion of the proceeds to lower outstanding debts.
Interest expenses for the reported quarter were up 24.2% to $385 million from $310 million in the year-ago period.
Financial Position
As of Jun 30, 2021, Occidental had cash and cash equivalents of $4,569 million compared with $2,008 million on Dec 31, 2020.
As of Jun 30, 2021, the company had a long-term debt (net of current portion) of $35,352 million compared with $35,745 million on Dec 31, 2020. The debt level decrease was due to effective management of debt since the acquisition of Anadarko.
For first- half of 2021, cash from operations was $4,224 million, up from $1,699 million in the prior-year period. Free cash flow for the first half of 2021 was $3.6 billion.
For first-half 2021, Occidental’s total capital expenditure was $1,277 million compared with $1,675 million invested in the year-ago period.
Guidance
For third-quarter 2021, it expects production in the range of 1,130-1,160 Mboe/d and output from Permian Resources in the band of 484-494 Mboe/d. The company expects exploration expenses to be $55 million.
For 2021, Occidental expects production to be 1,150 Mboe/d and output from Permian Resources to be 483 Mboe/d. The company expects exploration expenses for 2021 to be $250 million.It expects to invest $2.9 billion in 2021 to further strengthen the existing operations. A total of $2.53 billion was invested in 2020. A major portion of the planned capital expenditure will be directed toward strengthening its oil and gas operations.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended upward during the past month. The consensus estimate has shifted 141.8% due to these changes.
VGM Scores
Currently, Occidental has a strong Growth Score of A, a grade with the same score on the momentum front. Charting a somewhat similar path, the stock was allocated a grade of B on the value side, putting it in the top 40% for this investment strategy.
Overall, the stock has an aggregate VGM Score of A. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been trending upward for the stock, and the magnitude of these revisions looks promising. Notably, Occidental has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.