Petrochemical company Occidental Petroleum (OXY) is set to announce its third-quarter earnings on Monday, November 10th, after the closing bell.
Analysts expect a 49% decline in EPS to $0.51 on revenue of $6.7B.
According to Seeking Alpha analyst Curonian Research, Occidental’s Chemicals divestment will strengthen the balance sheet, reducing debt by ~$6.5 billion and lowering annual interest expense by about $350 million.
“However, lower oil prices are eroding cash flow, with each $1/bbl change in oil impacting pre-tax profits,” the analyst added.
In the past 2 years, OXY has beaten EPS estimates 100% of the time and has beaten revenue estimates 38% of the time.
Scotiabank’s Samantha Hoh last month raised Occidental (OXY) to Buy from Hold, seeing the $9.7B sale accelerating Occidental’s debt retirement and significantly pulling forward share buybacks, while remaining committed to a sustainable and growing dividend, and forecasting the company to generate a total $4.35 billion of free cash flow after dividends over 2026-27,
Occidental last month agreed to sell its OxyChem chemicals arm to Berkshire Hathaway for $9.7 billion in an attempt to slash debt after years of costly acquisitions.
Over the last 3 months, EPS estimates for Occidental have seen 5 upward revisions and 12 downward, while revenue estimates have seen 9 upward revisions.