The last time I wrote about Occidental Petroleum Corporation (NYSE:OXY) I did not buy anymore shares stating that I saw bearish technicals. The stock is down 6.73% excluding the dividend (-6.06% including the dividend) since last writing the article versus the 1.18% gain the S&P500 (SPY) posted. Occidental is an oil & gas production company, which operates in three segments: Oil & Gas, Chemical, and Midstream, Marketing and Other. On October 29, 2013, the company reported third-quarter earnings of $1.97 per share, which beat the consensus of analysts' estimates by $0.09. During the past year the company's stock is up 21.06% excluding dividends (up 23.91% including dividends), and is losing to the S&P 500, which has gained 25.21% in the same time frame. With all this in mind, I'd like to take a moment to evaluate the stock on a fundamental, financial, and technical basis to see if it's worth buying more shares of the company right now for the basic materials sector of my dividend portfolio.
Fundamentals
The company currently trades at a trailing 12-month P/E ratio of 15.87, which is fairly priced, but I mainly like to purchase a stock based on where the company is going in the future as opposed to what it has done in the past. On that note, the 1-year forward-looking P/E ratio of 12.47 is currently inexpensively priced for the future in terms of the right here, right now. Next year's estimated earnings are $7.32 per share and I'd consider the stock inexpensive until about $110. The 1-year PEG ratio (4.64), which measures the ratio of the price you're currently paying for the trailing 12-month earnings on the stock while dividing it by the earnings growth of the company for a specified amount of time (I like looking at a 1-year horizon), tells me that the company is expensively priced based on a 1-year EPS
