No. of Recommendations: 2
I presume the apparent cheapness is because you're not getting the dividends that the common will get.
I agree the real cost of the warrants, as compared to equity, is the foregone dividend. It will be hard to estimate this for OXY, because of the complicated agreements they have to redeem the Buffett warrants (not traded and different from OXY+) and other capital allocation decisions.
But OXY+ is still much more attractive than any call option. Even the $23 Jan 2024 option has a higher cost than the OXY+ $22 August 2027.
And if dividends are higher than forecast you can exercise the warrant or sell it. For US taxpayers, warrants held over a year benefit from LTCG treatment, while options get STCG treatment irrespective of holding period.
