Stock Analysis | Occidental Petroleum Outlook - Technical Weakness Looms Despite Mixed Fundamentals

Market Snapshot

Headline Takeaway: Occidental Petroleum faces a bearish technical outlook with an internal diagnostic score of 3.59, despite a recent price rise of 3.34% and mixed fundamental indicators.

News Highlights

Recent news in the energy sector hints at both potential tailwinds and headwinds for Occidental. On the positive side, Colombia plans to boost its E&P investment by 8% in 2025, signaling renewed global interest in hydrocarbon projects. Meanwhile, President Bola Tinubu of Nigeria has introduced tax incentives for upstream oil and gas operations, which may attract new investment into the sector.

On the negative side, Trump officials are pushing for more oil drilling in Alaska, a move that could increase U.S. oil production and pressure international oil prices. Additionally, private equity exits in fossil fuels are already surpassing 2024 levels, potentially affecting capital availability for mid-sized oil players like OXY.

Analyst Views & Fundamentals

Analysts remain cautious, with Morgan Stanley’s Devin J. Mcdermott giving a “Neutral” rating as of August 18, 2025. The simple average analyst rating is 3.00, while the performance-weighted rating is 1.65, indicating a significant dispersion of views and a weak alignment with the current price trend, which has seen a 3.34% rise over the past month.

Key fundamental metrics include:

• Revenue-MV: internal diagnostic score of 2, with a value of 0.88
• Net profit attributable to parent company shareholders / Net profit: internal diagnostic score of 3, with a value of 74.59%
• Inventory turnover ratio: internal diagnostic score of 3, with a value of 2.43
• Net income-Revenue: internal diagnostic score of 3, with a value of -22.66%
• Profit-MV: internal diagnostic score of 0, with a value of -44.11%

While the company shows moderate performance in revenue and profit metrics, the negative net income-revenue ratio and low profit-MV score point to underlying profitability concerns.

Money-Flow Trends

The fund-flow score for OXY is 7.83, indicating a “good” internal score level. Despite negative trends in small and medium-sized funds (both at -ve), the large and extra-large institutional flows are showing positive trends. Notably, block inflows are positive with a ratio of 50.16%, suggesting strong interest from major institutional investors.

Key Technical Signals

Technically, Occidental is under pressure. The stock has 3 bearish indicators and 0 bullish ones, with an internal diagnostic score of 3.59, signaling a weak technical setup. Recent indicators include:

• WR Oversold (Score: 3.41) – historically linked to mixed returns.
• WR Overbought (Score: 2.64) – signals an overextended rally with a 48.15% win rate.
• Bearish Engulfing (Score: 2.68) – a bearish reversal pattern with a 44.44% win rate.

On August 6 and 5, the stock triggered a WR Oversold and Bearish Engulfing signal, which aligns with the broader bearish sentiment. More recently, on August 13 and 15, WR Overbought signals were observed, indicating a volatile price environment with no clear direction.

The key technical insight is that the market is in a volatile state with bearish signals dominating, suggesting traders should be cautious in entering new long positions.

Conclusion

In light of the bearish technical setup and mixed fundamentals, investors should consider waiting for a clearer trend before committing capital to Occidental Petroleum. The internal diagnostic score of 3.59 highlights a weak chart environment, and while institutional money is flowing in, the retail and medium-sized fund flows are negative. Watching the upcoming earnings release (recently occurred on August 6) and future price reactions to key support levels could provide more clarity on the stock’s near-term direction.