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Occidental (OXY) to Report Q4 Earnings: What's in the Cards?

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Occidental Petroleum Corporation OXY is set to report fourth-quarter 2019 earnings on Feb 27, after market close. In the last reported quarter, the oil and gas company delivered a negative earnings surprise of 73.2%.

Factors to Consider

Selling, general and administrative (SG&A), and other expenses are expected to have substantially increased year over year due to seasonally higher environmental remediation charges, which are likely to have had an adverse impact on fourth-quarter earnings. SG&A for the fourth quarter is expected to be $901 million, indicating a substantial increase from $473 million in the year-ago period.

The Zacks Consensus Estimate for fourth-quarter revenues is pegged at $6.51 billion, which indicates growth of 35.7% from the year-ago reported figure. The Zacks Consensus Estimate for the bottom line is pegged at a loss of 6 cents per share, which indicates a 104.9% decline from the year-ago quarter.

Q4 Expectation

During third-quarter earnings call, Occidental provided its guidance for fourth-quarter production within 1,312-1,336 thousand barrels of oil equivalent per day (MBoe/d) and Permian Resources output in the range of 449-459 MBoe/d. However, due to reduced downtime, strong base and new well performance, the company expects total output and Permian Resources production to be 1,402 MBoe/d and 476 MBoe/d, respectively.

Earnings Whispers

Our proven model doesn’t conclusively predict an earnings beat for Occidental this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. But that’s not the case here.

Earnings ESP: The company’s Earnings ESP is -23.53%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter

Zacks Rank: Occidental carries a Zacks Rank #3.

Stocks to Consider

Here are some companies that you may consider from the same Oils & Energy sector as these have the right combination of elements to post an earnings beat in the to-be-reported quarter.

Apache Corporation APA is slated to release fourth-quarter 2019 results on Feb 26. It has an Earnings ESP of +26.53% and a Zacks Rank of 3. You can see the complete list of today’s Zacks #1 Rank stocks here.

Berry Petroleum Corporation BRY is set to release fourth-quarter 2019 results on Feb 26. It has an Earnings ESP of +2.50% and sports a Zacks Rank of 1.

California Resources Corporation CRC is scheduled to release fourth-quarter 2019 results on Feb 26. It has an Earnings ESP of +0.51% and a Zacks Rank of 2.

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