Goldman Sachs raises Occidental Petroleum price target to $69
Goldman Sachs has upgraded its outlook on Occidental Petroleum, changing its rating from Neutral to Buy and raising its price target from $63 to $69. The bank’s analysts, led by Neil Mehta, highlighted the company’s potential to generate an additional $4 billion in cash flow by 2030 through operational improvements and cost efficiencies. Occidental has been working to reduce its debt, recently cutting its principal debt to $11.8 billion and aiming for further reductions. Goldman Sachs also noted the company’s attractive valuation at current levels, alongside its strong dividend growth prospects and advanced enhanced oil recovery techniques.
The upgrade comes as Occidental continues to strengthen its financial position. In its second-quarter results, the company reported adjusted earnings per share of $2.40, up from $0.26 a year earlier, and generated $5.1 billion in operating cash flow. Global production reached 1.433 million barrels of oil equivalent per day, surpassing guidance. CEO Richard Jackson emphasized the company’s focus on capital efficiency and deleveraging, stating that Occidental is “executing from a strong balance sheet” while improving resources and delivering cost efficiencies.
Goldman Sachs’ bullish outlook is not solely based on higher oil prices but also on Occidental’s ability to improve productivity and reduce costs. The bank’s $69 target represents a 9.5% increase from its previous target, and market reports indicated that Occidental’s shares rose around 4% following the upgrade. The stock closed at $57.84 on October 1. The wider oil market remains favorable, with Brent crude staying above $100 per barrel amid geopolitical uncertainty, although prices remain sensitive to global supply and demand dynamics.
The next key milestone for Occidental will be its third-quarter results, due after the US market closes on November 9, with an earnings call scheduled for November 10. Investors will be watching closely to see if the company can sustain its operational improvements and convert higher oil prices into sustained free cash flow while continuing to reduce debt. Goldman Sachs’ forecast reflects optimism, but it remains an analyst projection rather than a certainty.