Occidental Petroleum: 7.5% Growing Yield From Oversold E&P Oil Company

Co-produced with Trapping Value and Treading Softly
Picking up out of favor stocks for large yields requires an iron stomach and patience. Very rarely do you end up buying at the exact bottom and very rarely does the market decide to turnaround just because you joined the bullish camp. But in the long run it is a rewarding exercise. Today we look at another former blue-chip that has been bruised and battered as commodity producers are being left on the wayside. We are referring to integrated oil company, Occidental Petroleum (OXY). Currently, it yields 7.5%.

A brief history of overreaching
OXY proposed to buy Anadarko Petroleum (APC) for a total of $57 billion, including assumed debt, a price that was definitely higher than we would have liked. Stock markets have a way of continuing their sentiment trends. Near tops, even the most atrocious deals are celebrated and the acquirer and the acquired company, both, go up in price. At the bottom, even the most sound business deals are puked on and the acquiring companies are punished relentlessly.
Occidental believes its proposal is superior both financially and strategically for Anadarko’s shareholders, creating a global energy leader with the scale and geographic diversification to drive growth and deliver compelling value and returns to the shareholders of both companies. The combined company will be uniquely positioned to leverage Occidental’s demonstrated operational and technical expertise, producing greater... Read more