Out Fox The $treet

  Occidental Petroleum reported weak Q2'23 numbers with a big EPS miss. OXY stock has been propped up by Warren Buffett aggressively buying shares over the last year at elevated prices. Occidental Petroleum trades at over 20x normalized EPS targets and should be avoided. After the close,  Occidental Petroleum Corporation  ( NYSE: OXY ) reported disappointing  Q2 2023 results . As long predicted, analysts weren't accurately predicting the return to lower earnings based on historical energy prices. My  investment thesis  remains  Bearish on OXY stock, still trading over $60 due to the Warren Buffett put. Read the full article on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details . 

 Update - May 8, 2023 Berkshire not buying control of Oxy  confirms why the stock is capped here.  -Berkshire Hathaway (NYSE:BRK.B) (NYSE:BRK.A) won't buy control of Occidental Petroleum (NYSE:OXY), Chairman and CEO Warren Buffett said during Berkshire's annual meeting in Omaha on Saturday. -"We wouldn't know what to do with it," he said, adding that he's confident in OXY's management. -"We may or may not own more" of the stock in the future, he said. -In March, Berkshire Hathaway (BRK.B) added almost 3.7M more shares to its holdings, bringing its stake in the petroleum producer to ~23.6%. Original article posted on March 19 OXY has fallen below $60 again leading to Berkshire Hathaway purchasing more shares. Energy prices have fallen to levels consistent with Q3'21 levels when the company earned far close to a $3 to $4 EPS stream. The stock isn't priced for lower earnings leaving OXY trading at ~20x '23 EPS targets. After multiple war...

Occidental continues to hold up well due to a strong balance sheet. The company still needs to work on improving cash flows to ensure the dividend can survive the current oil price slump. The stock has more downside risk with cash flows in the current negative position. With the cutting of the dividend by ConocoPhillips (NYSE: COP ) , all of the major oil companies are under extra scrutiny now. Dividends that were previously unquestioned will now need cash flows to justify paying them going forward. Read the full article at Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Though oil continues plunging, the oil giants continue producing more. For Q4, Occidental Petroleum (OXY) had roughly flat production. The worst part is that OXY plans to grow production by 2% to 4% in 2016. The stock has held up somewhat strong, but the inability to turn off the spigot remains troubling. Disclosure: No positions mentioned. Please review the disclaimer page for more details.