Should You Pick Occidental Stock Over Its Competitors?

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Over its last four quarters, Occidental Petroleum (OXY) grew revenue faster than any of five oil and gas peers. Yet its stock trades at the lowest multiple of earnings in the group. Part of that low multiple comes from a single quarter in which profit ran far ahead of what Occidental’s operations earned. So how much less are you paying for Occidental than for a rival it outgrew?

Occidental Grew Faster Than ConocoPhillips But Costs Less

Occidental trades at 6.9 times earnings, compared with 14.0 times for fellow oil and gas producer ConocoPhillips. One quarter lifts Occidental’s earnings, however: in fiscal Q1 2026, the company booked a $3.35 billion profit on $0.927 billion of operating income.

Measured on sales and operating profit instead, Occidental is still ahead. Its revenue grew 34.7% over its last four quarters, against 13.3% at ConocoPhillips. It also kept 29.3% of its sales as operating profit, against 24.7% at ConocoPhillips, so you would be paying less for a company that grew faster and earned a wider margin. Set against operating profit instead of earnings, Occidental’s $57.0 billion market value is about 7.8 times its $7.32 billion of operating profit over those four quarters. ConocoPhillips’ $162 billion is about 9.6 times its $16.8 billion. On the same measure, EOG Resources ($78.5 billion against $10.9 billion) and Diamondback Energy ($49.9 billion against $7.4 billion) cost less than Occidental.

Among the group of six, Occidental ranks first on revenue growth and third on operating margin, trailing EOG Resources and Diamondback Energy. Yet its stock return over the past year ranks only fifth, placing it ahead of Diamondback Energy alone.

Is Occidental’s Growth A Rebound From Falling Sales?

Occidental earns almost all of its revenue from oil and gas. In fiscal 2025, its oil and gas segment had $20.9 billion of revenue, against $1.28 billion for midstream and marketing. That fiscal year ended in December 2025, three months after the twelve months to September 2025.

The recovery held in the latest quarter, when revenue rose 19.0% from a year earlier. Management said its U.S. onshore wells beat the midpoint of its own production forecast, more than making up for lower output in the Gulf of America and abroad.

How Does Occidental Plan To Use Its Cash?

Occidental plans to pay down debt rather than produce more. On the November 10, 2026 call, management said it expects 2027 production to be relatively flat compared with 2026, on capital spending of about $5.9 billion.

Total debt was $12.6 billion at the end of September 2026, against $22.9 billion a year earlier. In the third quarter, management said principal debt reached its earlier $10 billion goal. Management has set a new goal of $6 billion of principal debt. At that level, it expects interest expense of about $400 million a year, roughly $1 billion less than in 2025.

The risk for a holder comes from commodity prices. Management credited higher commodity prices, along with cost discipline, for the free cash flow Occidental generated in the third quarter. With output planned flat, Occidental’s sales growth now rests more on those prices.

For Occidental to earn a place above its rivals, it has to keep growing sales while putting its spare cash toward paying down debt rather than producing more output. So far it has: revenue in the latest quarter was still up from a year earlier. Occidental’s revenue growth against a year earlier is the measure to watch when it reports in February 2027.

Not Sure Occidental Petroleum Is Worth It At This Price?

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