Occidental Petroleum (OXY) is expected to report modest cash generation in Q4, with no major asset sales or significant debt reduction, UBS Securities said in an earnings preview emailed Wednesday.
The firm anticipates under $100 million in cash flow for the quarter.
In addition, UBS expects CrownRock's integration to drive 0 to 2% total company volume growth in 2025, with CrownRock's five-rig program supporting mid-single-digit growth at the asset level, while the rest of Occidental's business is expected to remain flat.
"We look for a STRATOS update, with construction on track for the first 250 thousand metric tons per annum of capacity to be online by mid-year," UBS added.
Additionally, the expiration of two oil transportation contracts, one at the end of Q1 and another at the end of Q3, is projected to provide about $180 million in additional free cash flow in 2025, growing to roughly $400 million annually by 2026, according to the firm.
UBS increased price target on Occidental's stock to $54 from $51 and maintained its neutral rating.
Price: 50.47, Change: -0.08, Percent Change: -0.16
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