Stock Analysis | Occidental Petroleum Outlook - Mixed Signals Amid Oil Sector Volatility

Market Snapshot

Takeaway: Occidental Petroleum faces a mixed outlook, with weak technical signals but relatively strong fundamentals. The stock has seen a modest rise of 0.54% recently, but most analysts remain neutral.

News Highlights

Recent news underscores the mixed environment for the oil sector. For example:

• Colombia's 8% E&P investment surge (May 29) highlights a growing global appetite for hydrocarbon development, which could indirectly benefit OXY through stronger oil prices.
• President Tinubu's new executive order (May 31) in Nigeria aims to improve cost efficiency and attract investment in the oil and gas industry—another positive for the sector's long-term momentum.
• Private equity exits in fossil fuels are on the rise, with deals in the first half of 2025 already nearing last year’s total. This suggests increased liquidity in the sector, which could affect OXY's competitive positioning.

Analyst Views & Fundamentals

Analysts remain cautious but not bearish on OXY. The simple average rating stands at 3.00, while the performance-weighted rating is 2.73. The ratings are consistent in their neutrality, though the weighted score reflects a slightly lower confidence in the recent accuracy of analyst calls.

Comparing this to the stock's 0.54% price increase, it's clear the market is not yet convinced by the fundamentals—though the internal diagnostic score for fundamentals is 5.78 (on a 0-10 scale), suggesting underlying strength.

Key fundamental metrics and their internal diagnostic scores include:

• Revenue-MV (score: 2.00): Revenue-to-market value is 88.32%.
• Net profit attributable to parent company shareholders / Net profit (score: 3.00): 74.59%.
• Inventory turnover ratio (score: 3.00): 2.43 times.
• Net income-Revenue (score: 3.00): -0.23 (or -22.69%).
• Income tax / Total profit (score: 1.00): 31.74%.
• Long-term debt to working capital ratio (score: 1.00): 95.93%.
• Asset-MV (score: 3.00): 135.31%.
• Inventory turnover days (score: 2.00): 74.08 days.

The mixed bag of metrics reflects a company with decent asset performance but higher debt and less-than-ideal profit margins.

Money-Flow Trends

Big money and retail investors are both showing a negative trend in fund flows. The internal diagnostic score for fund flow is 7.85 (on a 0-10 scale), which is a "good" score, indicating that the market is not entirely bearish despite the recent outflows.

• Small-trend: -49.83% inflow ratio.
• Medium-trend: -48.79% inflow ratio.
• Large-trend: -49.32% inflow ratio.
• Extra-large-trend: +50.09% inflow ratio.

While large-scale investors are pulling back, the extra-large segment is showing a positive inflow. This contrast could indicate a strategic reallocation rather than a broad sell-off.

Key Technical Signals

Technically, OXY is in a weak position. The technical score is 3.12 (on a 0-10 scale), and the trend is bearish. Here are the key indicators:

• WR Overbought (score: 2.64): This suggests overbought conditions but with a neutral bias.
• WR Oversold (score: 3.16): A neutral rise signal but with a high win rate of 50.00%.
• Bearish Engulfing (score: 2.68): A bearish pattern with a weak historical win rate (44.44%).
• MACD Golden Cross (score: 4.34): A bullish signal, but only neutral in bias.
• Earnings Release Date (score: 4.87): A high score, but the pattern is neutral.
• Bullish Engulfing (score: 1.00): A very weak signal with a poor historical win rate (16.67%).

In the past week, Bullish Engulfing appeared on August 20, while WR Overbought was a recurring signal. The key insight is that the market is in a volatile and directionless phase, with bearish signals dominating.

Conclusion

Occidental Petroleum is in a tricky position: fundamentals are relatively strong, but technical indicators and recent money flows are bearish. With weak internal technical signals and mixed analyst ratings, this may not be the best time to chase the stock's modest gains.

Actionable takeaway: Consider waiting for a clearer trend or use this period to monitor key developments such as the upcoming earnings release for more direction.