No. of Recommendations: 3
In not quite a month as Occidental Petroleum's (OXY.N), opens new tab CEO, Richard Jackson has already been challenged with looking for ways to lift a lagging stock price and pay down more debt. Longer term, Jackson may face a more fundamental question: whether to seek a buyer for the oil company that has a roughly $51 billion market cap.
"The biggest opportunity is to clean up the capital structure, strengthen the balance sheet and increase shareholder returns," said David Byrns, a portfolio manager at American Century Investments, which holds an Occidental stake worth about $131 million, according to LSEG data.
Despite operational improvements so far, Occidental must either make more acquisitions or look for a buyer, said Bill Smead, chief investment officer at Smead Capital Management, which owns a roughly $201 million Occidental position. The oil industry has seen a wave of mega-mergers in recent years, as producers sought to consolidate and lower operational costs. "Either Occidental needs to get bigger and beef up the oil in the tank, or they're probably going to have to be part of a larger oil and gas company," Smead said.
https://www.reuters.com/legal/transactional/occide... 