Should I Buy Occidental Petroleum (OXY)? Finance YouTuber Analysis

The YouTuber owns Occidental Petroleum and is considering selling, stating he is 'closer to selling this one than I am to buying more.' He notes the stock has performed well due to volatile oil and gas prices, and he might take profits, as he's not excited about the company at current prices.

“Occidental Petroleum, ticker symbol OXY, and this is an oil and gas company. And this is another one of those that I own. I'm actually closer to selling this one than I am to buying more.”

The analyst recommends Occidental Petroleum, highlighting its strong operational control, cost efficiency, and significant debt reduction. The acquisition of Crown Rock has boosted its Permian Basin presence and reserves. Additionally, Oxy's expertise in CO2 enhanced oil recovery and its developing carbon capture business position it well for future energy trends, including potential European investment in cleaner energy, which is not yet priced into the stock, despite Warren Buffett's substantial stake.

“Occidental is another one that analysts don't expect much from this year with sales seen falling a third of a percent this year and then growing by less than 3% next. Here we do see a relative discount though with the stock trading for 1.6 6 times price to sales, well off the 2.2 times sales multiple it traded at at that peak when Buffett started buying the shares.”

The YouTuber expresses skepticism about Occidental Petroleum as an acquisition target, despite its large Permian assets and improving productivity, primarily because Warren Buffett's significant ownership (25%) would complicate any takeover. Additionally, its diversified nature as an integrated oil company might make it less appealing to acquirers specifically seeking pure-play Permian assets, and it trades at a premium to its historical price-to-sales valuation.

“any acquisition of this company would definitely have have to go through Warren Buffett and have to get his approval”

The YouTuber recommends buying Occidental Petroleum (OXY), noting it's a 'Warren Buffett fave' and was up nearly 4% recently. He expects it to rise further if the world is at war, suggesting it will go back to its high of day.

“Oxy, ticker symbol OXY. This one is accidental petroleum. This is a Warren Buffett fave and this one is sitting at $46.80. This one was up nearly 4% at the high of day. It will go back there tomorrow when we wake up and the world is at war.”

The YouTuber suggests buying Occidental Petroleum as a swing trade when tech stocks begin to sell off. He argues that these types of stocks will go up when high-flying tech stocks cool down, offering an opportunity for temporary gains.

“put accidental petroleum on your radar ticker symbol oxy this next one is chewy ticker symbol chwy now check this out if they pull back tomorrow for example you just need to look at it like okay I'm preparing for the next day Tech sells off coach told me these stocks are going to fly up all right”

The YouTuber recommends Occidental Petroleum as a stock to watch, noting its recent positive performance and its position in the energy sector. He argues that as money leaves tech, it flows into sectors like energy and healthcare, making OXY a beneficiary of this market shift.

“when I talk about the shift okay these are things we are paying attention to on a daily basis you need to know that when Tech begins to go down okay going down just simply means hedge funds and Wall Street is selling so if Wall Street is selling and they're making the tech stocks go down where are they putting that money they are putting the money into energy Health Care okay and so I want you guys to pay attention to these type of stocks on this upcoming week because this is where the focus will be”

The YouTuber notes that Berkshire Hathaway added 3.5% to its Occidental Petroleum position. This indicates a continued accumulation in a stock that Buffett has shown significant interest in.

“and then there's also a 3.5% addition to ocidental petroleum”

The YouTuber suggests Occidental Petroleum as a buy, noting that investor sentiment in the oil sector is at historical lows, creating a contrarian opportunity. They highlight Warren Buffett's continued accumulation of OXY shares despite a recent price drop. The company has shown strong management by increasing earnings forecasts even with lower oil prices, and its high sensitivity to oil price changes means significant upside if oil demand normalizes with economic stimulus.

“De hecho este año llegó a estar las acciones en 70 80 Warren buffett Estaba comprando a 55 y ahora actualmente caso comprando están a 45 de hecho se puede ver aquí la bajada de casi 70 a casi en línea recta coincidiendo con este sentimiento negativo que hay en todo el posicionamiento de los inversores.”

The YouTuber notes that Warren Buffett has been consistently adding to his position in Occidental Petroleum since early 2022, making it about 6% of Berkshire Hathaway's portfolio. This indicates Buffett's continued interest in the oil and gas sector, suggesting it's a stock he currently favors.

“Occidental Petroleum is one that Buffett has been adding for a while let's look at the chart this is Buffet Stak in ocidental petroleum he's just been adding to this quarter after quarter.”

Warren Buffett's Berkshire Hathaway invested $13 billion in Occidental Petroleum, acquiring nearly a quarter of its tradable shares. This move aligns with Buffett's historical strategy of investing in oil stocks to benefit from price increases or to hedge his portfolio.