Occidental Set to Report Q2 Earnings: What's in Store for the Stock?

Occidental Petroleum Corporation OXY is expected to report a year-over-year decline in its top and bottom lines when it reports second-quarter 2025 results on Aug. 6, after market close.

The Zacks Consensus Estimate for OXY’s second-quarter revenues is pegged at $6.48 billion, indicating a decline of 5.83% from the year-ago reported figure.

The Zacks Consensus Estimate for earnings is pegged at 28 cents per share. The Zacks Consensus Estimate for OXY’s second-quarter earnings indicates a decline of 72.82% from the year-ago reported figure.

Earnings Surprise History

OXY’s earnings beat the Zacks Consensus Estimate in all the trailing four quarters, the average surprise being 24.34%.

What the Zacks Model Unveils

Our model does not predict a likely earnings beat for OXY this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. That is not the case here, as you can see below.

Occidental Petroleum Corporation Price and EPS Surprise

Occidental Petroleum Corporation price-eps-surprise | Occidental Petroleum Corporation Quote

You can uncover the best stocks to buy or sell before they are reported with our Earnings ESP Filter.

Earnings ESP: OXY has an Earnings ESP of -3.84%.

Zacks Rank: Occidental Petroleum currently carries a Zacks Rank #3.

Stocks to Consider This Season

Here are some stocks in the same sector that have the combination of factors indicating an earnings beat this season.

ARRAY Technologies, Inc. ARRY is expected to beat second-quarter earnings estimates when it reports results on Aug. 7, 2025. The company currently has an Earnings ESP of +76.19% and a a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Long-term (three to five years) earnings growth of the company is pegged at 21.63%. The Zacks Consensus Estimate of ARRY’s 2025 and 2026 earnings per share indicates year-over-year growth of 10% and 35.35% respectively.

Plains GP Holdings PAGP is expected to beat second-quarter earnings estimates when it reports results on Aug. 8, 2025. The firm currently has an Earnings ESP of +50.00% and sports a Zacks Rank #1.

The Zacks Consensus Estimate of PAGP’s 2025 and 2026 earnings per unit indicates year-over-year growth of 205.77% and 23.79%, respectively.

HighPeak Energy, Inc. HPK is expected to beat second-quarter earnings estimates when it reports results on Aug. 11, 2025. The company currently has an Earnings ESP of +58.33% and a Zacks Rank #2.

The Zacks Consensus Estimate of HPK’s 2025 and 2026 earnings per share indicates year-over-year growth of 2.99% and 3.62% respectively.

Factors Likely to Have Shaped OXY’s Q2 Earnings

Permian Resources assets remain a consistent contributor to the firm’s overall production. Production from Permian is expected in the range of 760-780 thousand barrels of oil equivalent per day (Mboe/d) for second-quarter 2025, and the company expects total production in the band of 1,377-1,417 Mboe/d in second-quarter 2025.

OXY’s second-quarter production volumes are projected to improve compared to the previous quarter, primarily due to improvement in Permian activity levels, the completion of annual plant maintenance at Dolphin, and the return of Gulf of America production following seasonal maintenance projects.

OXY expects earnings are likely to have been adversely impacted in the second quarter due to a drop in Midstream earnings as a result of declining commodity prices and the associated timing of delivery and cargo sales.

The company is also working to reduce its operating expenses and is trying to reduce its domestic lease operating expense, which is likely to boost margin and have a positive impact on earnings.

Occidental Petroleum is generating cash flow and utilizing the same to reduce debts, which is likely to have a positive impact on earnings. The company retired debts worth $6.8 billion, which lowered annual interest expenses by $370 million; undoubtedly, it will have a positive impact on earnings per share.

OXY’s Price Performance

OXY shares have gained 11.9% in the past three months compared with the industry’s rally of 6%.

OXY Stock Trading at a Premium

Occidental Petroleum’s shares are somewhat expensive on a relative basis, with its current trailing 12-month Enterprise Value/Earnings before Interest Tax Depreciation and Amortization (EV/EBITDA TTM) being 5.15X compared with its industry average of 4.45X.

Investment Thesis

Occidental Petroleum has benefited from its robust domestic operations and strategic focus on Permian resources, where its core development area continues to deliver strong results. The addition of new assets through acquisitions is also expected to have contributed to production volumes in the second quarter.

However, since the company typically maintains exposure to market commodity prices, the fluctuating oil prices are likely to have an adverse impact on its second-quarter earnings.

Wrapping Up

Occidental Petroleum’s cash flow generation, initiative to lower debts, and contribution from acquisitions are expected to have boosted its performance. Earnings from the Midstream segment are expected to be up sequentially in the to-be-reported quarter.

Occidental Petroleum currently has a Zacks Rank #3. Hence, those who already own this stock would do well to retain it in their portfolio, and others should wait for a better entry point.

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This article originally published on Zacks Investment Research (zacks.com).

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