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Guess Who’s Buying up Occidental Petroleum Stock?

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Yesterday, Warren Buffett’s Berkshire Hathaway bought 6.68 million OXY shares worth $390.68 million. 

Investment world behemoth Warren Buffett has reaffirmed his belief in Occidental Petroleum (OXY) yet again. Yesterday, Warren Buffett’s Berkshire Hathaway Inc. (BRK.A) lapped up 6.68 million OXY shares worth $390.68 million.

Notably, this is not the only gigantic buy Buffet has made in the stock. Buffet has slowly and steadily built up his stake in OXY stock by making several Informative Buys over the past three months.

With his latest Buys, Buffett’s Berkshire Hathaway now owns more than 20% stake in the company.

TipRanks’ Insider Trading Tool shows Berkshire Hathaway’s bullish Buys on OXY stock over the past few weeks and months.

The tool also shows that Insider Confidence Signal is currently Positive for Occidental Petroleum, with corporate insiders buying OXY stock worth $2.6 billion in the last three months.

Interestingly, TipRanks also provides a list of hot stocks that boasts either a Very Positive or Positive insider confidence signal.

Now, let’s take a closer look at the recent events at the company that could have further sparked Buffet’s interest in the stock.

Occidental Petroleum Posted Outstanding Q2 Results

On August 2, Occidental Petroleum posted robust second-quarter results, which significantly surpassed earnings and revenues estimates on the back of surging oil and gas prices and burgeoning demand.

During the quarter, OXY repaid a whopping $4.8 billion of its debt, which accounted for 19% of its total debt outstanding.

Further, the company bought back 18 million shares worth $1.1 billion through August 1, 2022.

Despite the buybacks and the debt repayment, the company reported strong cashflows, with a record quarterly free cash flow before working capital of $4.2 billion and cash flow from continuing operations of $5.3 billion.

What Is the Future of OXY Stock?

The future looks bright for OXY stock. Looking at the impressive second-quarter results and strong company fundamentals, Stifel and Wells Fargo have upwardly revised their price targets.

Stifel analyst Michael Scialla increased the price target on Occidental Petroleum to $86 (43.24% upside potential) from $81 and reiterated a Buy rating.

According to TipRanks, the Street is cautious but optimistic about OXY. Occidental Petroleum carries a Moderate Buy consensus rating based on seven Buys, seven Holds, and two Sells. OXY’s average price forecast of $75.56 implies 25.85% upside potential.

Is OXY a Good Long-term Investment?

Looking at Warren Buffet’s stance, OXY stock could be considered by long-term investors. Further, Occidental Petroleum has steadily grown its net worth and has a history of generating attractive returns for its stakeholders.

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