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Why Is Occidental (OXY) Down 5.9% Since Last Earnings Report?
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A month has gone by since the last earnings report for Occidental Petroleum (OXY - Free Report) . Shares have lost about 5.9% 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 the most recent earnings report in order to get a better handle on the important catalysts.
Occidental Petroleum Corporation reported third-quarter 2022 earnings of $2.44 per share, lagging the Zacks Consensus Estimate of $2.48 by 1.6%. Earnings in the third quarter were lower than our estimate of $2.83 per share. In the year-ago quarter, the company reported earnings of 87 cents. Earnings improved year over year due to an increase in operating efficiencies and commodity prices. GAAP earnings of Occidental in third-quarter 2022 were $2.52 per share compared with 65 cents in the year-ago quarter.
Total Revenues
Occidental's total revenues were $9,501 million, which surpassed the Zacks Consensus Estimate of $9,354 million by 1.6%. The top line also improved 39.4% from the year-ago quarter. The year-over-year improvement was due to a rise in contribution from all its segments. Total revenues were higher than our estimate of $9,402.1 million.
Segmental Details
Oil and Gas revenues for the quarter were $7,098 million, up 43.3% year over year.
Chemical revenues for the quarter were $1,691 million, up 21.1% year over year.
Midstream & Marketing revenues for the quarter were $1,005 million, up 43.2% year over year.
Production & Sales
Occidental’s total production volume for the third quarter was 1,180 thousand barrels of oil equivalent per day (Mboe/d), which was above the company’s guidance of 1,140-1,170 Mboe/d. Strong production volumes were attributed to higher volumes from the Rockies and other domestic assets. Permian Resources’ production for the third quarter was with 523 Mboe/d, which was near the lower end of the guidance of 523-533 Mboe/d.
For the quarter under review, total sales volume was 1,179 Mboe/d, up 1.8% from 1,158 Mboe/d recorded in the year-ago period. The improvement was due to an increase in U.S. sales volume.
Realized Prices
Third-quarter realized prices of crude oil improved 38% year over year to $94.89 per barrel on a worldwide basis. Realized natural gas liquids’ prices also improved 3.6% from the prior-year quarter to $35.22 per barrel worldwide. Natural gas prices increased 92.7% from the year-ago quarter to $5.57 per thousand cubic feet worldwide. The company benefited from a worldwide improvement in commodity prices.
Highlights of the Release
Occidental’s total expenses for the reported quarter were $6,119 million, up 6.7% year over year.
The company generated $3.6 billion in free cash flow in the third quarter and repaid debts of $1.3 billion during the third quarter, with year-to-date repayments of $9.6 billion through Nov 7, 2022, further strengthening the balance sheet.
Interest expenses for the reported quarter were down 36.5% to $285 million from $449 million in the year-ago period.
Occidental repurchased more than 41.8 million shares for $2.6 billion through Nov 7, 2022.
Financial Position
As of Sep 30, 2022, Occidental had cash and cash equivalents of $1,233 million compared with $2,764 million as of Dec 31, 2021. As of Sep 30, 2022, the company had long-term debt (net of current portion) of $20,478 million compared with $29,431 million as of Dec 31, 2021. The decrease in the debt level was due to the effective management of debt since the acquisition of Anadarko.
For third-quarter 2022, cash flow from operations was $4,700 million, up from $2,967 million in the prior-year period. Occidental’s total capital expenditure for third-quarter 2022 was $1,147 million compared with $656 million invested in the year-ago period.
Guidance
For the fourth quarter of 2022, OXY expects production of 1,200-1,260 Mboe/d and output from Permian Resources of 556-590 Mboe/d. Occidental expects fourth-quarter exploration expenses of $115 million.
OXY aims to repurchase shares worth $3 billion in 2022, which will further improve shareholders value. Occidental has plans to invest $3.9-$4.3 billion in 2022 to further strengthen its operation.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -10.69% due to these changes.
VGM Scores
At this time, Occidental has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. 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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Why Is Occidental (OXY) Down 5.9% Since Last Earnings Report?
A month has gone by since the last earnings report for Occidental Petroleum (OXY - Free Report) . Shares have lost about 5.9% 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 the most recent earnings report in order to get a better handle on the important catalysts.
Occidental Q3 Earnings Lag, Revenues Beat Estimates
Occidental Petroleum Corporation reported third-quarter 2022 earnings of $2.44 per share, lagging the Zacks Consensus Estimate of $2.48 by 1.6%. Earnings in the third quarter were lower than our estimate of $2.83 per share. In the year-ago quarter, the company reported earnings of 87 cents. Earnings improved year over year due to an increase in operating efficiencies and commodity prices. GAAP earnings of Occidental in third-quarter 2022 were $2.52 per share compared with 65 cents in the year-ago quarter.
Total Revenues
Occidental's total revenues were $9,501 million, which surpassed the Zacks Consensus Estimate of $9,354 million by 1.6%. The top line also improved 39.4% from the year-ago quarter. The year-over-year improvement was due to a rise in contribution from all its segments. Total revenues were higher than our estimate of $9,402.1 million.
Segmental Details
Oil and Gas revenues for the quarter were $7,098 million, up 43.3% year over year.
Chemical revenues for the quarter were $1,691 million, up 21.1% year over year.
Midstream & Marketing revenues for the quarter were $1,005 million, up 43.2% year over year.
Production & Sales
Occidental’s total production volume for the third quarter was 1,180 thousand barrels of oil equivalent per day (Mboe/d), which was above the company’s guidance of 1,140-1,170 Mboe/d. Strong production volumes were attributed to higher volumes from the Rockies and other domestic assets. Permian Resources’ production for the third quarter was with 523 Mboe/d, which was near the lower end of the guidance of 523-533 Mboe/d.
For the quarter under review, total sales volume was 1,179 Mboe/d, up 1.8% from 1,158 Mboe/d recorded in the year-ago period. The improvement was due to an increase in U.S. sales volume.
Realized Prices
Third-quarter realized prices of crude oil improved 38% year over year to $94.89 per barrel on a worldwide basis. Realized natural gas liquids’ prices also improved 3.6% from the prior-year quarter to $35.22 per barrel worldwide. Natural gas prices increased 92.7% from the year-ago quarter to $5.57 per thousand cubic feet worldwide. The company benefited from a worldwide improvement in commodity prices.
Highlights of the Release
Occidental’s total expenses for the reported quarter were $6,119 million, up 6.7% year over year.
The company generated $3.6 billion in free cash flow in the third quarter and repaid debts of $1.3 billion during the third quarter, with year-to-date repayments of $9.6 billion through Nov 7, 2022, further strengthening the balance sheet.
Interest expenses for the reported quarter were down 36.5% to $285 million from $449 million in the year-ago period.
Occidental repurchased more than 41.8 million shares for $2.6 billion through Nov 7, 2022.
Financial Position
As of Sep 30, 2022, Occidental had cash and cash equivalents of $1,233 million compared with $2,764 million as of Dec 31, 2021. As of Sep 30, 2022, the company had long-term debt (net of current portion) of $20,478 million compared with $29,431 million as of Dec 31, 2021. The decrease in the debt level was due to the effective management of debt since the acquisition of Anadarko.
For third-quarter 2022, cash flow from operations was $4,700 million, up from $2,967 million in the prior-year period. Occidental’s total capital expenditure for third-quarter 2022 was $1,147 million compared with $656 million invested in the year-ago period.
Guidance
For the fourth quarter of 2022, OXY expects production of 1,200-1,260 Mboe/d and output from Permian Resources of 556-590 Mboe/d. Occidental expects fourth-quarter exploration expenses of $115 million.
OXY aims to repurchase shares worth $3 billion in 2022, which will further improve shareholders value. Occidental has plans to invest $3.9-$4.3 billion in 2022 to further strengthen its operation.
How Have Estimates Been Moving Since Then?
It turns out, estimates review have trended downward during the past month.
The consensus estimate has shifted -10.69% due to these changes.
VGM Scores
At this time, Occidental has a great Growth Score of A, though it is lagging a lot on the Momentum Score front with an F. However, the stock was allocated a grade of A on the value side, putting it in the top 20% 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 broadly trending downward for the stock, and the magnitude of these revisions indicates a downward shift. Notably, Occidental has a Zacks Rank #3 (Hold). We expect an in-line return from the stock in the next few months.