Occidental Petroleum’s Stock Price ahead of 4Q15 Earnings



Occidental Petroleum’s stock price in downtrend

Declining crude oil and natural gas prices over the last year are dragging the entire upstream sector into a downtrend. As you can see in the graph below, Occidental Petroleum’s (OXY) stock price is in a downtrend and making a clear pattern of lower highs and lower lows.

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OXY’s stock price performance before 4Q15 earnings

OXY has shown a good relative strength when compared with other upstream stocks. In the last two months, OXY’s stock price has fallen ~13%. Compare this with the SPDR S&P Oil & Gas Exploration & Production ETF (XOP), which fell ~33% during the same period.

For 2015, OXY outperformed S&P 500 (SPY) upstream companies. OXY fell ~13%, but Pioneer Natural Resources (PXD), EOG Resources (EOG), and Murphy Oil (MUR) fell ~16%, ~23%, and ~56%, respectively.

OXY’s stock price performance

OXY reported its 3Q15 earnings before the market opened on October 28, 2015. In 3Q15, excluding the one-time items, OXY reported profits of $0.03 per share. That was $0.04 better than the consensus for a loss of $0.01 per share. Following the earnings release, better-than-expected earnings saw OXY stock rise ~9% in just five sessions.

A similar upward reaction was observed after its 4Q14 earnings when OXY stock rose ~10% in two weeks after beating consensus earnings estimates by $0.04 per share.

However, OXY’s 1Q15 and 2Q15 post-earnings reactions were negative. In 1Q15 it was due mainly to the inline earnings report. In 2Q15, it was the worse-than-consensus earnings report.


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