To The Moon

$Occidental(OXY)$

As an investor in Occidental Petroleum (OXY), I have chosen to maintain my position in the company despite the recent volatility in its stock price. Below, I outline the reasons why I am not selling my shares and believe that holding on to OXY is the right decision in the current market environment:

1. OXY Appears Oversold

One of the primary reasons I am not selling my Occidental shares is that I believe the stock is oversold. An oversold condition typically suggests that the market has overreacted to short-term news or sentiment, pushing the stock price below its intrinsic value. This creates an opportunity for long-term investors to purchase at a discount. While market fluctuations are a normal part of investing, the fundamental value of the company remains strong, and I see this as a temporary dip that will eventually correct itself. I believe in the long-term growth prospects of OXY, especially in light of its financial and operational strengths.

2. Strong Financial Performance

Occidental has demonstrated solid financial performance, which provides me with confidence in the company's ability to weather market downturns. Key indicators such as net income and earnings per share (EPS) have remained strong in recent quarters, signaling that the business is operating efficiently and generating consistent profits. Even when the stock price underperforms, I focus on the company’s strong fundamentals, and Occidental has proven its ability to deliver value to shareholders over time.

3. OXY Is Undervalued Compared to Its Competitors

Looking at Occidental’s price-to-earnings (P/E) ratio, it appears that the stock is undervalued relative to many of its peers in the energy sector. The P/E ratio is a critical metric in determining how much investors are willing to pay for a company’s earnings, and OXY’s relatively low P/E ratio suggests that the market may not be fully pricing in the company’s earnings potential. When compared to competitors in the oil and gas space, Occidental is trading at a more attractive valuation, making it a compelling choice for long-term investors. This undervaluation presents a buying opportunity, and it gives me confidence that the stock will appreciate over time as the market recognizes its true value.

4. Trading Below the 52-Week Range

Another reason I’m holding on to my shares is that OXY is currently trading below its 52-week range. This means the stock price is lower than it has been at any point in the past year, which is often seen as a signal that the market may be overreacting to short-term pressures. For a long-term investor, this provides an opportunity to purchase shares at a reduced price, especially when the company’s underlying fundamentals remain strong. Historically, stocks that dip below their 52-week range have tended to bounce back, and I believe OXY will follow a similar pattern once market conditions stabilize.

5. No Compelling Negative News to Justify Selling

Despite the recent underperformance of the stock, there are no significant negative events or news surrounding Occidental that would justify selling my shares. In fact, many of the concerns that have affected the stock seem to be driven more by broader market conditions than by any fundamental weaknesses within the company itself. The oil and gas sector has been subject to macroeconomic factors like fluctuations in oil prices and geopolitical uncertainties, but these are not unique to Occidental. Without a major shift in company-specific circumstances or news that materially impacts the business, there is no reason for me to sell.

6. Berkshire Hathaway’s position in OXY

Berkshire Hathaway, led by the legendary investor Warren Buffett, holds a substantial position in Occidental. The fact that Buffett and his team have confidence in OXY is a key endorsement of the company’s potential. Berkshire Hathaway is known for making long-term investments in companies with strong fundamentals, and their investment in Occidental serves as an important signal to me that OXY has a bright future ahead. Trusting the judgment of one of the most successful investors in history reinforces my own conviction to hold onto my shares.

7. Stable Dividends and the Upcoming Ex-Dividend Date

Occidental has consistently paid dividends, providing a steady income stream for shareholders. The upcoming ex-dividend date makes this an ideal time to hold onto my shares, as it will allow me to receive the next dividend payout. OXY’s ability to maintain a stable dividend in recent years, even amid economic uncertainty, demonstrates the company’s financial strength and commitment to returning value to its shareholders. Stable dividends are an important factor for long-term investors like myself who value income generation as part of their overall investment strategy.

8. Energy Sector Tailwinds

The broader energy sector is experiencing a period of uncertainty, but I believe that Occidental is well-positioned to capitalize on future energy market dynamics. Global demand for energy, especially oil and natural gas, is expected to remain strong in the long term. Moreover, Occidental’s focus on carbon capture technologies and sustainability initiatives puts it at the forefront of the energy transition, positioning the company for future growth in a changing global economy.

9. Long-Term Growth Potential

Occidental’s focus on innovation and sustainability is another reason why I believe in its long-term growth potential. The company has made significant investments in carbon capture and storage (CCS), an emerging technology that could become a critical part of the global energy transition. As governments and corporations around the world increase their focus on environmental sustainability, companies like Occidental that are investing in clean energy technologies are well-positioned for future success. I am confident that these long-term growth opportunities will translate into increasing value for shareholders over time.

10. Strategic Leadership and Operational Efficiency

Occidental’s leadership team has demonstrated effective strategic decision-making, especially in navigating difficult market conditions. The company has focused on improving its balance sheet, reducing debt, and enhancing operational efficiency. These steps have strengthened the company’s financial position and improved its ability to weather cyclical downturns. With management focused on executing a clear strategy and returning value to shareholders, I believe Occidental is in good hands, which further reinforces my decision to hold onto my shares.

11. Attractive Risk-Reward Profile

Given the company’s strong fundamentals, undervaluation, and positioning within the energy sector, I see the risk-reward profile of Occidental as highly favorable. While there is inherent risk in any investment, I believe the potential upside outweighs the downside. The market's current skepticism regarding OXY’s short-term performance creates an opportunity to buy into the stock at a discount, with the expectation that it will appreciate as market conditions normalize. This attractive risk-reward profile makes holding OXY an appealing choice for my portfolio.

12. Resilient Business Model

Occidental has a well-diversified business model that spans upstream, midstream, and chemical operations. This diversification allows the company to generate revenue from multiple sources, reducing its dependence on any one segment of the market. Even if oil prices face short-term volatility, Occidental’s diversified portfolio provides resilience and stability, making it less vulnerable to market swings. This operational flexibility gives me confidence that the company can continue to generate cash flow and return value to shareholders, regardless of short-term challenges.

In conclusion, I am choosing to hold my shares in Occidental Petroleum because of the company’s strong financial health, undervaluation relative to peers, consistent dividend payments, and long-term growth potential. I believe that the recent price dip presents an opportunity rather than a reason to sell. The combination of Berkshire Hathaway’s position in OXY, positive leadership, and market tailwinds makes me confident that OXY is a solid investment for the future. Therefore, I will continue to hold my shares and wait for the market to recognize the true value of Occidental.