Is Occidental Petroleum Stock Underperforming the Dow?
Valued at a market capitalization of about $46.9 billion, Texas-based Occidental Petroleum Corporation (OXY) is a diversified energy and chemicals powerhouse. Beyond its core oil and gas exploration and production business, the company manufactures a wide range of products, including basic and specialty chemicals, polymers, and petrochemicals. Its operations are spread across three segments: Oil and Gas, Chemical, and Midstream & Marketing, providing it with broad exposure across the energy landscape.
Companies valued at $10 billion or more are generally classified as “large-cap” stocks, and Occidental Petroleum certainly fits into this category, with a market capitalization that exceeds this threshold. The company ranks among the largest oil and gas producers in the U.S., with notable positions in the Permian Basin, DJ Basin, and the Gulf of Mexico. The company also operates a midstream and marketing segment that supports its energy operations, which includes Oxy Low Carbon Ventures, focused on developing technologies to reduce emissions.
After hitting a 52-week high of $57.57 in August 2024, OXY stock has retreated 17.3% from that level. However, lately the stock has been catching the market’s attention, with its price soaring nearly 14.8% over the past three months, comfortably surpassing the Dow Jones Industrial Average’s ($DOWI) 7.9% return during the same period.
While Occidental’s recent rebound has been impressive, the broader picture remains far less flattering. Over the past 52 weeks, the stock has declined by nearly 16.2%, and it remains under pressure in 2025, with a year-to-date (YTD) decline of 3.6%. By comparison, DOWI has steadily climbed higher, up 10.8% over the past year and boasting a 7.1% YTD gain, underscoring OXY’s relative underperformance against the broader market.
Occidental’s chart has been flashing bearish signals for months, with the stock trading under both its 50-day and 200-day moving averages since November last year. However, in a notable shift, the stock managed to break back above these key technical levels by late August 2025, suggesting a potential reversal in momentum.
OXY’s dependence on volatile commodity markets and its sizable debt load have long been sore points for investors, with limited hedging leaving the company especially vulnerable to oil price swings. Yet, its recent momentum tells a different story, one powered by meaningful progress on debt reduction, a top priority since the hefty 2019 Anadarko acquisition.
On Aug. 6, Occidental delivered a mixed fiscal Q2 2025 earnings report, topping Wall Street’s profit forecasts but falling short on revenue. Even so, management struck an optimistic tone, revealing that $3 billion in debt has already been repaid this year through asset sales, healthy cash flow, and proceeds from warrant exercises. The progress on balance sheet improvement overshadowed the revenue miss, fueling investor confidence and lifting OXY shares 2.5% on Aug. 7.
Meanwhile, Occidental’s peer Coterra Energy Inc. (CTRA) has fared only slightly better over the past year, edging up 1.6% compared to OXY’s double-digit loss. However, the tables turn in 2025, with Coterra sliding 4.3% YTD, an even steeper drop than Occidental’s 3.6% decline, underscoring the broader struggles facing the energy sector this year.
Considering Occidental’s underwhelming long-term price action, Wall Street appears to take a wait-and-see approach for this stock. Of the 26 analysts covering the stock, the consensus rating stands at “Hold,” with an average price target of $50, implying about 5% upside from current levels.
On the date of publication, Anushka Mukherjee did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com