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Occidental Petroleum Corporation (OXY) Soars to 52-Week High, Time to Cash Out?
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Have you been paying attention to shares of Occidental Petroleum (OXY - Free Report) ? Shares have been on the move with the stock up 2.5% over the past month. The stock hit a new 52-week high of $63.56 in the previous session. Occidental Petroleum has gained 104.2% since the start of the year compared to the 28.5% move for the Zacks Oils-Energy sector and the 49.3% return for the Zacks Oil and Gas - Integrated - United States industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 24, 2022, Occidental reported EPS of $1.48 versus consensus estimate of $1.08 while it beat the consensus revenue estimate by 11.41%.
For the current fiscal year, Occidental is expected to post earnings of $8.68 per share on $33.52 billion in revenues. This represents a 240.39% change in EPS on a 27.38% change in revenues. For the next fiscal year, the company is expected to earn $7.19 per share on $32.06 billion in revenues. This represents a year-over-year change of -17.25% and -4.35%, respectively.
Valuation Metrics
Occidental may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Occidental has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 6.8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 12.6X. On a trailing cash flow basis, the stock currently trades at 5.1X versus its peer group's average of 9.3X. Additionally, the stock has a PEG ratio of 0.2. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Occidental currently has a Zacks Rank of #1 (Strong Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Occidental fits the bill. Thus, it seems as though Occidental shares could have potential in the weeks and months to come.
How Does OXY Stack Up to the Competition?
Shares of OXY have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Marathon Oil Corporation (MRO - Free Report) . MRO has a Zacks Rank of # 1 (Strong Buy) and a Value Score of C, a Growth Score of B, and a Momentum Score of A.
Earnings were strong last quarter. Marathon Oil Corporation beat our consensus estimate by 40%, and for the current fiscal year, MRO is expected to post earnings of $4.28 per share on revenue of $7.78 billion.
Shares of Marathon Oil Corporation have gained 2.2% over the past month, and currently trade at a forward P/E of 6.1X and a P/CF of 6.14X.
The Oil and Gas - Integrated - United States industry is in the top 4% of all the industries we have in our universe, so it looks like there are some nice tailwinds for OXY and MRO, even beyond their own solid fundamental situation.
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Occidental Petroleum Corporation (OXY) Soars to 52-Week High, Time to Cash Out?
Have you been paying attention to shares of Occidental Petroleum (OXY - Free Report) ? Shares have been on the move with the stock up 2.5% over the past month. The stock hit a new 52-week high of $63.56 in the previous session. Occidental Petroleum has gained 104.2% since the start of the year compared to the 28.5% move for the Zacks Oils-Energy sector and the 49.3% return for the Zacks Oil and Gas - Integrated - United States industry.
What's Driving the Outperformance?
The stock has an impressive record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on February 24, 2022, Occidental reported EPS of $1.48 versus consensus estimate of $1.08 while it beat the consensus revenue estimate by 11.41%.
For the current fiscal year, Occidental is expected to post earnings of $8.68 per share on $33.52 billion in revenues. This represents a 240.39% change in EPS on a 27.38% change in revenues. For the next fiscal year, the company is expected to earn $7.19 per share on $32.06 billion in revenues. This represents a year-over-year change of -17.25% and -4.35%, respectively.
Valuation Metrics
Occidental may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as these give investors a variety of ways to comb through stocks (beyond looking at the Zacks Rank of a security). These styles are represented by grades running from A to F in the categories of Value, Growth, and Momentum, while there is a combined VGM Score as well. Investors should consider the style scores a valuable tool that can help you to pick the most appropriate Zacks Rank stocks based on their individual investment style.
Occidental has a Value Score of C. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 6.8X current fiscal year EPS estimates, which is not in-line with the peer industry average of 12.6X. On a trailing cash flow basis, the stock currently trades at 5.1X versus its peer group's average of 9.3X. Additionally, the stock has a PEG ratio of 0.2. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to consider the stock's Zacks Rank, as this supersedes any trend on the style score front. Fortunately, Occidental currently has a Zacks Rank of #1 (Strong Buy) thanks to rising earnings estimates.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Occidental fits the bill. Thus, it seems as though Occidental shares could have potential in the weeks and months to come.
How Does OXY Stack Up to the Competition?
Shares of OXY have been soaring, and the company still appears to be a decent choice, but what about the rest of the industry? One industry peer that looks good is Marathon Oil Corporation (MRO - Free Report) . MRO has a Zacks Rank of # 1 (Strong Buy) and a Value Score of C, a Growth Score of B, and a Momentum Score of A.
Earnings were strong last quarter. Marathon Oil Corporation beat our consensus estimate by 40%, and for the current fiscal year, MRO is expected to post earnings of $4.28 per share on revenue of $7.78 billion.
Shares of Marathon Oil Corporation have gained 2.2% over the past month, and currently trade at a forward P/E of 6.1X and a P/CF of 6.14X.
The Oil and Gas - Integrated - United States industry is in the top 4% of all the industries we have in our universe, so it looks like there are some nice tailwinds for OXY and MRO, even beyond their own solid fundamental situation.