Buffett Bets Big on Oil Giants Chevron and Occidental
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 23 hours ago
0mins
Source: NASDAQ.COM
- Buffett's Investment Strategy: Warren Buffett's Berkshire Hathaway has acquired 6.5% of Chevron and 27% of Occidental Petroleum, making them the fourth and sixth largest holdings, respectively, reflecting confidence in the oil sector amid soaring crude prices.
- Occidental's Financial Performance: Occidental is projected to generate $1.2 billion in additional free cash flow this year without an increase in oil prices, and with rising prices, this figure is expected to increase significantly, providing funds for debt repayment and stock buybacks, showcasing its resilience in a low-price environment.
- Chevron's Growth Potential: Chevron anticipates generating $12.5 billion in incremental free cash flow this year at $70 oil, and with higher prices, its cash flow will further increase, enhancing its capacity for capital projects and shareholder returns.
- Optimistic Industry Outlook: Both companies demonstrate strong performance in low oil price environments, reaffirming Buffett's foresight in the oil sector, and as crude prices continue to rise, they are expected to achieve even higher free cash flows, further solidifying their market positions.
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Analyst Views on OXY
Wall Street analysts forecast OXY stock price to fall
16 Analyst Rating
4 Buy
9 Hold
3 Sell
Hold
Current: 64.360
Low
38.00
Averages
47.27
High
64.00
Current: 64.360
Low
38.00
Averages
47.27
High
64.00
About OXY
Occidental Petroleum Corporation is an international energy company with assets primarily in the United States, the Middle East and North Africa. The Company is an oil and gas producer in the United States, including a producer in the Permian and DJ basins, and the offshore Gulf of Mexico. Its segments include oil and gas, and midstream and marketing. The oil and gas segment explores for, develops, and produces oil (which includes condensate), natural gas liquids (NGL) and natural gas. The Company's midstream and marketing segment purchases, markets, gathers, processes, transports, and stores oil (which includes condensate), NGL, natural gas, carbon dioxide (CO2) and power. The midstream and marketing segment provides flow assurance and maximizes the value of its oil and gas. It also optimizes its transportation and storage capacity and invests in entities that conduct similar activities. This segment also includes low-carbon venture businesses.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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