On Wednesday, Mizuho (NYSE:MFG) Securities adjusted its outlook on Occidental Petroleum (NYSE:OXY) shares, reducing the price target to $68 from the previous $70, while maintaining a Neutral rating for the stock. The move comes as the firm anticipates a slight underperformance in Occidental's fourth-quarter earnings before interest, taxes, depreciation, amortization, and exploration expenses (EBITDAX) and cash flow per share (CFPS).
The analysis by Mizuho suggests that Occidental Petroleum's in-line production volumes may not fully compensate for the pre-reported realizations. Investors are expected to turn their attention to the company's capital plan for 2025, which is set to be detailed next month. Occidental Petroleum had previously shared some overarching comments during their third-quarter 2024 earnings call, and formal guidance is anticipated soon.
The upcoming operational start of the first phase of the STRATOS project in mid-2025 is another point of interest, with market watchers keen on updates regarding the project's permitting process and steps towards commercialization.
Following the CrownRock divestiture, Occidental has been progressing ahead of schedule with its debt reduction efforts as of the third quarter of 2024. Updates on further asset sales and organic cash flow from operations (CFFO) margin growth are also among the anticipated disclosures.
Mizuho's decision to maintain a Neutral rating while lowering the net asset value (NAV) based price target to $68 per share is influenced by revised long-term realizations and Chemical margin assumptions. The firm's analysis reflects a cautious outlook on the stock, factoring in both Occidental's recent performance and expectations for its near-term financial strategy and operational developments.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.