On Tuesday, Occidental Petroleum (NYSE:OXY) maintained its Hold rating from Argus, with the firm keeping a close eye on the company's strategic moves following the CrownRock acquisition. The analyst at Argus highlighted Occidental's improved debt profile, which now aligns with that of its industry peers due to significant debt reduction efforts.
In a strategic bid to avoid over-leveraging its balance sheet, Occidental plans to sell off several non-core assets within the year after the CrownRock deal concludes. Argus has expressed reservations about this approach, questioning both the timing and the potential proceeds from these planned asset sales.
The firm's stance is to observe the closure of the Occidental-CrownRock transaction and monitor the execution of Occidental's asset divestiture plan. The analyst noted that the success of these sales is contingent upon favorable conditions in the energy markets. Argus will consider changing its rating for Occidental only after these factors are assessed and the company's strategy appears to be progressing effectively.
Occidental's approach to managing its financials and assets post-acquisition is under scrutiny, with market watchers looking for tangible evidence of successful strategy implementation. The outcome of the asset sales and the state of the energy markets in the coming months will be crucial for Occidental's future rating evaluations.
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