- Reports of a potential bid by Occidental Petroleum (NYSE:OXY) for Anadarko Petroleum (NYSE:APC) "introduces an entirely new level of uncertainty to the stock," Mizuho's Paul Sankey says in downgrading OXY to Neutral from Buy with a $70 price target, cut from $83.
- Mizuho analyst Paul Sankey says the offshore-heavy and development LNG-heavy nature of APC's asset base are not a good fit for OXY.
- A bid for APC also would imply either a total change in strategy or a need for free cash flow at OXY, Sankey says; the latter would imply OXY's future "dividend growth or even dividend cover is not as strong as we had assumed."