Oxy Jumps Into First Place

I think Occidental Petroleum (NYSE: OXY  ) may be an outlier. The company turned in a terrific quarter, as many exploration and production players likely will, thanks to sky-high crude oil prices. But unlike what many of its larger peers will probably report, it actually raised its production nicely in the quarter.

For the period, Occidental -- may I call you Oxy? -- earned $1.85 billion, or $2.23 a share, up an impressive 53% on the net income line from $1.21 billion, or $1.43 a share, in the year-ago quarter. Apparently, the dart-throwers who follow the company had it pegged to earn about $1.98 a share . With crude oil reaching progressively higher levels, the company's revenue rose 50% to $6.02 billion.

Earnings from the oil and gas segment increased 53%, as the average price of oil received hit $86.75 a barrel, vs. $51.67 a barrel in the year-ago quarter. At the same time, Oxy's average domestic gas realization increased 28%. But perhaps even more impressive -- since it will probably separate the company from many of its peers -- was an 8.4% hike in its average barrels of oil equivalent (boe) daily production.

Along with the oil and gas group's improved performance, the chemical segment raised its contribution for the quarter by 31% year over year. Finally, not to be outdone, the midstream segment chipped in more as well, if only by 3% to $123 million.

California-based Oxy has moved into first place for earnings growth on the short list of big oil companies reporting results thus far. True, its only peer at present is ConocoPhillips (NYSE: COP  ) , which saw its year-over-year earnings increase by 17%. But next week, Occidental could be forced to defend its first-place position against the likes of ExxonMobil (NYSE: XOM  ) , Murphy (NYSE: MUR  ) , and Hess (NYSE: HES  ) , all of whom will proudly tell us about their results.

Still, there's a lot to like about Oxy, including a strong balance sheet, low valuation, geographic reach, and growing production. If you share my belief that crude prices are headed higher, Oxy just might be worth some analytical time.

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