Free Trial

Buffett's Berkshire Increases Stake In Occidental Petroleum (OXY)

Berkshire Hathaway stock price

Key Points

  • Buffett's Berkshire Hathaway acquired an additional 2.1 million shares of Occidental Petroleum, boosting its ownership to over 25%.
  • Analysts predict a 20.12% upside for OXY, with a consensus price target of $70.29.
  • Occidental presents a compelling investment opportunity with an appealing valuation, strong management, and potential growth in the oil and gas sector.
  • 5 stocks we like better than Berkshire Hathaway.

Warren Buffett's Berkshire Hathaway NYSE: BRK.A NYSE: BRK.B disclosed in a filing late Wednesday that it purchased an additional 2,138,250 shares of Occidental Petroleum NYSE: OXY. Buffett's Berkshire acquired the additional shares between June 26 and June 28 for about $122.1 million. Berkshire's total ownership now stands at 224.1 million shares. The most recent purchase boosts Berkshire's stake in Occidental to more than 25% of outstanding shares.

Buffett's involvement with OXY began almost three years ago when Berkshire funded Occidental's takeover of Anadarko with $10 billion in equity. Buffett's company then began acquiring a stake in the oil company last year around the time when Russia invaded Ukraine, and the price of oil was rising. 

At Berkshire's annual meeting on May 6, Buffett was full of praise for the oil company and its management. Notably, Buffett said that Berkshire had no plans to take control of the company. He said, "We're not going to buy control," and added, "We've got the right management running it."

Berkshire Hathaway stock price

After boosting its ownership stake from 23.7% to 25.1% in OXY, Buffett's Berkshire further cements its spot as the largest shareholder of OXY, with State Street Corp's 5.2% in second place. Over the last 12 months, the net institutional inflow has been negative $1.16 billion, with total inflows of $3.98 billion and $5.14 billion in outflows. Current institutional ownership in OXY is 78.3%.

Analyst's Predict Upside In OXY

OXY stock forecast
Analysts covering Occidental have a consensus price target of $70.29, predicting a 20.12% upside in the oil name. Based on 21 analysts' ratings, the stock currently has a Hold rating. Eight analysts rate the stock a Buy, ten a Hold, two a Sell, and one a Strong Buy. Most recently, Stephens initiated coverage of OXY with a price target of $72 and an Overweight rating.

Performance of OXY Shares

OXY stock chart

Since Buffett first began buying Occidental shares in early March 2022, the stock has risen over 53%. During that same period, the SPDR S&P 500 ETF Trust NYSE: SPY has risen close to 1.25%. However, YTD shares of OXY are down 6.49%, while the SPY is up 14.56%. Of course, Buffett won't be concerned with a six-month comparative performance; instead, as fits with his philosophy, he will focus on a longer time frame.

Is Occidental A Good Investment?

Of course, investors shouldn't simply follow Buffett's Berkshire and invest in OXY but instead conduct their own due diligence and research. However, when looking at the oil company's prospects, it presents a compelling opportunity.

Firstly, Buffett's solid assessment of the company's management team, specifically in the leadership positions of OXY, is a crucial factor to keep in mind for investors. Occidental's valuation is also appealing, trading at a forward price-to-earnings ratio of approximately 12.09.

The demand for oil and gas is expected to rise in the upcoming years. This presents a significant opportunity for Occidental, particularly considering its substantial carbon capture and sequestration investments. Notably, the company focuses on direct air capture facilities, which extract carbon from the atmosphere.

Buffett's continued interest in Occidental is a positive factor, as he perceives the stock favorably and continues to add to Berkshire's already significant position.

Should you invest $1,000 in Berkshire Hathaway right now?

Before you consider Berkshire Hathaway, you'll want to hear this.

MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and Berkshire Hathaway wasn't on the list.

While Berkshire Hathaway currently has a "hold" rating among analysts, top-rated analysts believe these five stocks are better buys.

View The Five Stocks Here

Unlock the Potential in Options Trading Cover

Options trading isn’t just for the Wall Street elite; it’s an accessible strategy for anyone armed with the proper knowledge. Think of options as a strategic toolkit, with each tool designed for a specific financial task. Keep reading to learn how options trading can help you use the market’s volatility to your advantage.

Get This Free Report
Ryan Hasson
About The Author

Ryan Hasson

Contributing Author

Technical Analysis, Momentum Trading, Risk Management

Like this article? Share it with a colleague.

Companies Mentioned in This Article

CompanyMarketRank™Current PricePrice ChangeDividend YieldP/E RatioConsensus RatingConsensus Price Target
Occidental Petroleum (OXY)
4.605 of 5 stars
$54.76+0.3%1.61%13.49Hold$66.29
Compare These Stocks  Add These Stocks to My Watchlist 


Featured Articles and Offers

Recent Videos

Central Garden & Pet: Niche Focus, Big Growth Potential
Evolv Technologies Stock Up 59%: AI Security & 12-Month Forecast
Housing Prices Soar: These 3 Home Stocks May Benefit

Stock Lists

All Stock Lists

Investing Tools

Calendars and Tools

Search Headlines