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4 Reasons to Add Occidental Petroleum to Your Portfolio

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Estimates for Occidental Petroleum Corporation (OXY - Free Report) have been revised upward over the past 30 days, reflecting analyst’s confidence in the stock post solid first-quarter 2018 results. The Zacks Consensus Estimate for 2018 and 2019 earnings has moved up 26.8% and 39.8% to $3.79 and $4.04, respectively.

Occidental Petroleum is an international oil and gas exploration and production company with operations in the United States, Middle East and Latin America. Its wholly owned subsidiary, OxyChem, is a major North American chemical manufacturer.

The stock, sporting a Zacks Rank #1 (Strong Buy), has gained 38.9% in a year, outperforming the industry’s growth of 26.2%.



The stock has an impressive VGM Score of B. Here V stands for Value, G for Growth and M for Momentum with the score being a weighted combination of all three factors. Back tested results show that stocks with a favorable VGM Score of A or B coupled with a bullish Zacks Rank offer the best investment bets.

Let’s focus on the factors that make Occidental Petroleum an attractive stock to hold on to for greater returns.

Earnings Results: The company reported earnings of 92 cents per share in first-quarter 2018, which beat the Zacks Consensus Estimate of 71 cents by 29.6%.

Positive Earnings Surprise History: Occidental Petroleum has an impressive earnings surprise history. Its earnings surpassed the Zacks Consensus Estimate in each of the last four reported quarters, the average being 30.2%. The consecutive estimate beats reflect the company’s operational excellence.

Raised Production Guidance: The company expects 2018 total production between 645,000 and 665,000 boe/d, up from the prior expected range of 640,000-665,000 boe/d. It expects 2018 Permian Resources production in the range of 198,000-210,000 boe/d, up from the prior guidance of 195,000-209,000 boe/d.

Growth Projections: The Zacks Consensus Estimate for current-year earnings per share is pegged at $3.79, representing a whopping year-over-year increase of 325.8%.

For 2019, the consensus estimate for earnings per share is pegged at $4.04 depicting a 6.6% year-over-year rise.

Other Stocks to Consider

Some other top-ranked stocks from the Zack Oil and Energy Sector are Anadarko Petroleum Corporation , Canadian Solar Inc. (CSIQ - Free Report) and Enable Midstream Partners, LP , each sporting a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Anadarko Petroleum is one of the largest independent oil and natural gas exploration and production companies of the world. It pulled off an average quarter positive surprise of 89.24% in the last four quarters. The Zacks Consensus Estimate for 2018 EPS moved up 28.9% in the last 30 days to $2.54.

Canadian Solar is a Canada-based company that operates through eight wholly owned manufacturing subsidiaries with operations spread across 20 countries. It delivered an average four-quarter beat of 29.35%. The Zacks Consensus Estimate for 2018 EPS moved up 32.9% in the last 30 days to $2.06.

Enable Midstream operates and develops natural gas and crude oil infrastructure assets, serving major producing basins and markets. It came up with an average four-quarter beat of 15.9%. The Zacks Consensus Estimate for 2018 EPS moved up 7.5% in the last 30 days to $1.0.

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