In recent years, Occidental Petroleum Corporation has emerged as a major investment choice for Warren Buffett. The renowned investor commenced acquiring shares in the energy firm in 2022 and has progressively increased his holding. By the end of the second quarter of 2024, Buffett’s investment in Occidental was appraised at $16.09 billion.
Market analysts express optimism regarding Occidental, estimating an average price target of $70.44, which indicates a potential upside of 37.79% from its current price point. The stock holds a consensus rating of Moderate Buy, supported by 6 buy recommendations, 10 hold evaluations, and 1 sell verdict from Wall Street analysts. Buffett’s positive perspective on Occidental is derived from his confidence in the anticipated growth of oil prices and the company’s operational strengths.
The breakeven oil price for Occidental is below $60 per barrel, ensuring that they remain profitable with oil values exceeding $70.
Buffett’s assurance in Occidental
The organization has executed multiple acquisitions totaling billions, including the assets held by CrownRock in the Midland Basin, which have broadened its operational scope and enhanced its competitive stance.
Occidental has returned substantial sums to its shareholders via share repurchases and dividends. Currently, the firm provides a dividend yield of approximately 1.7%, making it enticing for investors seeking income. By the close of the second quarter of 2024, the number of hedge funds invested in Occidental rose to 62, with the total value of these stakes surpassing $18.52 billion.
This trend underscores considerable institutional interest in the stock. With Occidental’s robust fundamentals, Buffett’s confidence in the firm, and the favorable projections from analysts, it remains one of Warren Buffett’s prime stocks to consider. As the Oracle of Omaha begins to gradually reduce his investment activities, Occidental Petroleum Corporation stands out as a pivotal asset in his portfolio, with the potential to yield significant returns in the forthcoming years.
