The still-young year of 2025 hasn't been all that kind to oil stocks, many of which are trading down since New Year's Day. One of these laggards has been sector mainstay Occidental Petroleum (OXY -1.23%), despite the company's convincing bottom-line beat in its most recent earnings report.

Recently, one analyst tracking the stock downgraded his recommendation on Occidental and cut his price target. Yet his previous take was so bullish, he still feels the shares have significant upside.

Still a bull, despite the recommendation chop

Before the market opened Monday, Raymond James analyst John Freeman retagged Occidental stock as an outperform (buy, in other words) from his previous "strong buy" conviction. He also lowered the price target to $64 per share; formerly it was $81.

According to reports, Freeman's latest take is based on that classic energy sector catalyst, the price of oil. Recently this has sunk notably, with the per-barrel spot price of Brent crude tumbling to its lowest level so far this year. This alone, in the analyst's view, is sufficient to warrant care and caution when approaching Occidental stock.

Still, Freeman believes the company has many advantages. He particularly singled out the company's fourth quarter, in which it posted a significantly higher-than-expected net income figure. Meanwhile, management has guided for growth in both production and key fundamentals in the near future.

A better view is from the sidelines

Freeman's price target represents roughly 35% upside at Tuesday morning's prices. But while Occidental might appear to be in bargain territory by that standard, the current situation feels volatile. Uncertainty around how the Trump administration's tariffs might ultimately play out and affect the sector are causing anxiety with oil stocks. This feels to me like a time to wait and see how the situation plays out rather than assertively piling into such companies.