Occidental Petroleum (OXY) Is Up 5.9% After Announcing $22 Follow-On Equity Offering and Shelf Registration Has the Bull Case Changed?

• On July 28, 2025, Occidental Petroleum announced a follow-on equity offering of 31,990,880 common shares priced at US$22 per share and also filed a universal shelf registration for a wide range of securities, including debt and equity instruments.
• This combination of capital-raising measures often indicates the company is positioning itself to fund new initiatives, reduce debt, or pursue investment opportunities, which could influence its financial flexibility and future growth options.
• We'll review how Occidental’s sizeable equity issuance may affect its investment story, particularly regarding capital allocation and long-term expansion plans.

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Occidental Petroleum Investment Narrative Recap

To be a shareholder in Occidental Petroleum, you generally need to believe in the company’s ability to unlock long-term value through operational efficiency, new energy ventures, and disciplined capital allocation, even amid commodity price swings and the need for steady cash flows. The recent US$703.8 million equity offering bolsters Occidental’s financial flexibility, but does not appear to materially shift the importance of operational execution or amplify exposure to oil price volatility, which remain the key catalyst and risk, respectively, for the stock. Among the recent announcements, the May 2025 strategic alliance focused on launching a new Direct Air Capture facility stands out. This move is particularly relevant as the equity raise and universal shelf registration provide the company with options for funding high-capital projects that may help diversify future revenue streams beyond traditional oil and gas. In contrast, it’s important that investors also consider the heightened risk tied to Occidental’s increased capital expenditures, especially if those investments...

Read the full narrative on Occidental Petroleum (it's free!)

Occidental Petroleum is projected to generate $27.9 billion in revenue and $3.8 billion in earnings by 2028. This outlook assumes a -0.5% annual revenue decline, but an increase in earnings by $1.3 billion from the current $2.5 billion.

Uncover how Occidental Petroleum's forecasts yield a $50.35 fair value, a 11% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members submitted 28 fair value estimates ranging from US$38 to over US$112 per share, with broad variance across ten buckets. Against this backdrop, keep in mind that Occidental’s rising capital outlays could pressure returns if anticipated project outcomes fall short, challenging assumptions about future performance.

Explore 28 other fair value estimates on Occidental Petroleum - why the stock might be worth over 2x more than the current price!

Build Your Own Occidental Petroleum Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Occidental Petroleum research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Occidental Petroleum research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Occidental Petroleum's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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