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Citi Downgrades Occidental Petroleum (OXY) to Neutral

September 12, 2022 6:27 AM EDT
Get Alerts OXY Hot Sheet
Price: $69.11 +1.29%

Rating Summary:
    13 Buy, 24 Hold, 3 Sell

Rating Trend: = Flat

Today's Overall Ratings:
    Up: 5 | Down: 14 | New: 17
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Citi analyst Scott Gruber downgraded Occidental Petroleum (NYSE: OXY) from Buy to Neutral with a price target of $67.00 (from $65.00).

The analyst comments "We upgrade APA to Buy with a new target price of $58 and downgrade OXY to Neutral. APA offers an under-appreciated growth story combining upcoming exposure to the strength in global gas prices (starting in mid-2023) coupled with base volume growth, and potentially supplemented by a Suriname development longer term. Growth in CF over the next three years at strip is ~2%, whereas the average E&P declines over 20%. Yet the stock trades at a ~40% discount to large cap peers on 2023 CF with a 20%/25% FCF yield at Citi/Strip pricing in 2023. A confluence of events has led to OXY being the top performing E&P YTD (+126% v +49% for XOP). Yet the stock now trades at a 2023 CF multiple approaching EOG and remaining upside potential appears modest. Any thematic benefit of CCUS tax credit enhancement appears embedded while DAC deflation will take time."

For an analyst ratings summary and ratings history on Occidental Petroleum click here. For more ratings news on Occidental Petroleum click here.

Shares of Occidental Petroleum closed at $65.61 yesterday.



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