Top 15 Commodity Producers With the Highest Upside Potential

10. Occidental Petroleum Corporation (NYSE:OXY)

Analysts’ Upside Potential as of May 01: 29.28%

Occidental Petroleum Corporation (NYSE:OXY) is one of the world’s leading independent oil and gas producers. Its upstream operations are dispersed throughout North Africa, the Middle East, and the US. The firm owns a majority equity stake in Western Midstream and operates a consolidated midstream business that supplies the upstream segment with gathering, processing, and transportation services. The portfolio also consists of a chemicals company that makes PVC and caustic soda. The latter segment benefits from low energy and ethylene prices, but its profitability is governed by the strength of the overall economy.

Despite having dropped over 40% from its peak, Occidental Petroleum Corporation (NYSE:OXY) is still a strong investment opportunity due to its affordable price and advantageous supply dynamics. The lower-than-average U.S. oil supply at the moment may eventually catalyze rising oil prices, which would be advantageous to the company. When compared to competitors like ExxonMobil, Chevron, and BP, the business seems to be reasonably valued from a valuation perspective, particularly when looking at PEG and PE indicators. The business stands to benefit from operational leverage as well as a possible market re-rating as energy markets normalize and supply limitations persist. The firm’s combination of industry tailwinds and enticing valuation metrics places it as a remarkable fallen angel with a positive risk/reward profile for investors looking for value in the energy sector.

According to Occidental Petroleum Corporation (NYSE:OXY), production in the Permian Basin is expected to rise by more than 15% by 2025. This is due to a modest increase across legacy positions and a full year of CrownRock contributions. It is anticipated that CrownRock assets alone will average more than 170,000 BOE per day, which is more than 5% growth. The company’s US onshore portfolio accounts for more than 75% of its oil and gas capital, with the Permian receiving a sizable share of this allocation.