Critical Comparison: Occidental Petroleum (NYSE:OXY) & EXCO Resources (NYSE:XCOOQ)

Occidental Petroleum (NYSE:OXY) and EXCO Resources (OTCMKTS:XCOOQ) are both oils/energy companies, but which is the better business? We will contrast the two businesses based on the strength of their institutional ownership, dividends, analyst recommendations, profitability, earnings, valuation and risk.

Insider and Institutional Ownership

81.8% of Occidental Petroleum shares are owned by institutional investors. Comparatively, 0.3% of EXCO Resources shares are owned by institutional investors. 0.2% of Occidental Petroleum shares are owned by insiders. Comparatively, 1.4% of EXCO Resources shares are owned by insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a stock will outperform the market over the long term.

Profitability

This table compares Occidental Petroleum and EXCO Resources’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Occidental Petroleum 21.17% 17.70% 8.49%
EXCO Resources -46.37% -3.11% 3.13%

Analyst Recommendations

This is a summary of current ratings for Occidental Petroleum and EXCO Resources, as provided by MarketBeat.com.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Occidental Petroleum 1 13 7 0 2.29
EXCO Resources 0 0 0 0 N/A

Occidental Petroleum presently has a consensus target price of $75.57, suggesting a potential upside of 53.25%. Given Occidental Petroleum’s higher possible upside, equities analysts clearly believe Occidental Petroleum is more favorable than EXCO Resources.

Volatility and Risk

Occidental Petroleum has a beta of 0.86, suggesting that its share price is 14% less volatile than the S&P 500. Comparatively, EXCO Resources has a beta of 5.35, suggesting that its share price is 435% more volatile than the S&P 500.

Dividends

Occidental Petroleum pays an annual dividend of $3.12 per share and has a dividend yield of 6.3%. EXCO Resources does not pay a dividend. Occidental Petroleum pays out 62.3% of its earnings in the form of a dividend. Occidental Petroleum has increased its dividend for 16 consecutive years.

Earnings and Valuation

This table compares Occidental Petroleum and EXCO Resources’ top-line revenue, earnings per share and valuation.

Gross Revenue Price/Sales Ratio Net Income Earnings Per Share Price/Earnings Ratio
Occidental Petroleum $4.80 billion 7.68 $4.13 billion $5.01 9.84
EXCO Resources $394.03 million 0.01 -$182.70 million N/A N/A

Occidental Petroleum has higher revenue and earnings than EXCO Resources.

Summary

Occidental Petroleum beats EXCO Resources on 11 of the 14 factors compared between the two stocks.

About Occidental Petroleum

Occidental Petroleum Corporation, together with its subsidiaries, engages in the acquisition, exploration, and development of oil and gas properties in the United States and internationally. The company operates through three segments: Oil and Gas, Chemical, and Midstream and Marketing. The Oil and Gas segment explores for, develops, and produces oil and condensate, natural gas liquids (NGLs), and natural gas. The Chemical segment manufactures and markets basic chemicals, including chlorine, caustic soda, chlorinated organics, potassium chemicals, ethylene dichloride, chlorinated isocyanurates, sodium silicates, and calcium chloride; vinyls comprising vinyl chloride monomer, polyvinyl chloride, and ethylene. The Midstream and Marketing segment gathers, processes, transports, stores, purchases, and markets oil, condensate, NGLs, natural gas, carbon dioxide, and power. This segment also trades around its assets consisting of transportation and storage capacity; and invests in entities. Occidental Petroleum Corporation was founded in 1920 and is headquartered in Houston, Texas.

About EXCO Resources

EXCO Resources, Inc., an independent oil and natural gas company, engages in the acquisition, exploration, exploitation, development, and production of onshore oil and natural gas properties with a focus on shale resource plays in the United States. The company holds interests in approximately 96,600 net acres located in the Haynesville and Bossier shales of East Texas and North Louisiana; approximately 48,500 net acres located in the Eagle Ford shale of South Texas; and approximately 234,800 net acres of prospective area located in the Marcellus shale, as well as approximately 69,000 net acres of prospective area located in the Utica shale of the Appalachia region. As of December 31, 2018, it had proved reserves of approximately 660.6 billion cubic feet equivalent of oil and natural gas. The company was founded in 1955 and is based in Dallas, Texas. On January 15, 2018, EXCO Resources, Inc., along with its affiliates, filed a voluntary petition for reorganization under Chapter 11 in the US Bankruptcy Court for the Southern District of Texas.

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