Don’t Mistake Company Rewards for Insider Trading

Company rewards: Shares of Occidental Petroleum Corporation (NYSE:OXY) hit a 52-week-high of $97.24 per share on Wednesday, after what seemed to be heavy insider trading on Tuesday. Yet no such activity ocurred, or at least no insider purchased Occidental Petroleum shares. The shares acquired by James M. Lienert, Executive Vice President of the firm, were also granted to other high ranking employees such as Vice President Edward A. Lowe and VP Controller Pineci Roy. These operations form part of an award to board members and vary according to the position held by each individual.

James Lienert received 16,610 shares of common stock, of which he sold 6,968 shares at a value of $95.49 each. The Executive Vice President’s holdings now amount to 146,266 shares or approximately $14,183,414 (at $96.97 per share, as of Oct. 16, 4:42 pm EST). On Wednesday, the value of Occidental Petroleum shares increased by 1.83% after opening at $95.99. However, this increase was not motivated by insider trading, since the insiders did not buy the shares, but rather received them free of charge from the firm.

Instead, the increase is related to positive news, such as the election of Vicki Hollub as Vice President and the announcement of a regular quarterly dividend of $0.64 per share. The dividend will be payable on January 15^th, 2014.

With a compound annual growth rate of 18% in sales and of 16% for net income, Occidental Petroleum is very attractive. Share prices have been rising steadily, following the positive results the firm continues to present to shareholders. Growing dividends are also worth mentioning, as the company offers good returns on investments. It would come as no surprise to see stock prices rise even further at the end of the month, since Occidental Petroleum is set to announce its third quarter results on October 29^th.

Disclosure: Pablo Erbar holds no position in any stocks mentioned

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