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Occidental Petroleum’s Stock Price ahead of 4Q15 Earnings

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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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