CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
Our 12-month target price of $72, up $2, reflects a 6.5x multiple of enterprise value to projected ’24 EBITDA, in line with OXY’s historical forward average. We raise our ’23 EPS estimate by $0.60 to $4.17 and ’24’s by $0.40 to $5.24. Q3 EPS of $1.18 vs. $2.44 beat the consensus view by $0.32. Q3 production averaged 1.22 mmboe/d, up 3.6% year-over-year, and 2.1% above consensus, with outperformance derived from a variety of basins. OXY guided to Q4 production flat to slightly higher sequentially, but we note that OXY’s Delaware Basin productivity from new wells has gradually improved over time, which we believe implies that its target production levels can be achieved at relatively low capex. OXY redeemed an additional 3% of its preferred stock outstanding in Q3, and is now up 15% redeemed cumulatively. In so doing, OXY is reducing future interest expense given the high coupon (8%) associated with those shares.