OXY
Occidental Petroleum Corporation
$58.81
Oil & Gas E&P
85%
FCF at Price Deck × Multiple
Strong
·
Conviction
Overvalued
Trading 62.1% above fair value
You pay
$58.81
Bear
$1.60
Fair
$36.28
Bull
$82.55
Bear
$1.60
-97.3%
FCF $2874M × 8x
Fair
$36.28
-38.3%
FCF $4105M × 11x
Bull
$82.55
+40.4%
FCF $5336M × 14x
Key Value Driver
Oil price assumption ($75/bbl base case)
Implied Market Multiple
19.6x
Summary
Our base-case estimate uses a valuation based on free cash flow under different commodity price assumptions and a valuation multiple. We then blend that result with the average analyst price target of $60.38 from 52 analysts, using a 35% weight on analyst consensus. That produces an estimated intrinsic value of $36.28 per share.
Warnings
Debt per share ($22.09) is significant relative to the stock price. Even small changes in the debt figure meaningfully shift what each share is worth.
If oil drops to $60/barrel, the stock could fall -98%. Check whether the company can survive at low prices and still pay its dividend.
Where you think oil prices will settle long-term drives over 80% of this valuation. The biggest risk isn't the company itself — it's getting the commodity price wrong.
Wall Street's average price target is $60.38 (from 52 analysts). Our estimate is 61% below the consensus -- consider that gap carefully.
Key Risks
- Growth DCF inappropriate — commodity volumes do not compound
- Geopolitical premiums are real but historically temporary
- Reserve replacement ratio below 100% for 3 years is existential