Rising Production Guidance Could Be a Game Changer for Occidental Petroleum (OXY)

• Occidental Petroleum Corporation recently provided updated third quarter 2025 production guidance, expecting output to reach 1.42 million to 1.46 million barrels of oil equivalent per day across all main operating areas.
• This signals continued operational momentum and a broad-based production increase, suggesting progress in efficiency and capacity expansion across Occidental's core assets.
• We'll examine how the higher production guidance adds weight to Occidental's investment narrative around operational momentum and cash flow resilience.

Find companies with promising cash flow potential yet trading below their fair value.

Occidental Petroleum Investment Narrative Recap

To own shares of Occidental Petroleum, I believe investors need confidence in the company’s ability to maintain production growth and operational discipline amid industry volatility. The recent upward adjustment to third-quarter 2025 production guidance is relevant for the short-term cash flow catalyst, reinforcing Occidental’s operational momentum, but it does not fully address the ongoing balance sheet risk from high leverage, so the key risk remains unchanged for now.

Among recent announcements, the February 2025 completion of a share buyback program stands out. Occurring alongside improved production guidance, this signals efforts to return capital to shareholders and potentially offset dilution, supporting the investment case where rising output and shareholder returns are both meaningful short-term drivers.

Yet, despite the stronger outlook, it’s important to consider that Occidental’s sustained high leverage could become an issue if...

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

Occidental Petroleum's narrative projects $28.8 billion revenue and $3.6 billion earnings by 2028. This requires 2.0% yearly revenue growth and a $1.9 billion earnings increase from $1.7 billion today.

Uncover how Occidental Petroleum's forecasts yield a $50.42 fair value, a 14% upside to its current price.

Exploring Other Perspectives

Simply Wall St Community members are split on Occidental’s fair value, with 31 estimates ranging from US$31.69 to US$102.53. In light of the company’s high leverage, these diverse opinions underline why you should review several viewpoints before making up your mind.

Explore 31 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 4 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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