Why Occidental Petroleum Stock Slumped 17% in 2024 but Could Rally in 2025

Core Viewpoint - Occidental Petroleum experienced a significant decline in stock value in 2024, losing 17.3%, while the S&P 500 index gained 23% [1] Group 1: Stock Performance and Market Reaction - Despite Berkshire Hathaway's continuous share purchases, investor sentiment remained cautious due to rising debt and falling crude oil prices [2] - The stock suffered the most in the second half of 2024, coinciding with a major acquisition of CrownRock for nearly $12 billion, which included$1.2 billion of existing debt [3][4] - Investors were concerned that lower oil prices would negatively impact Occidental's financial performance and cash flows, especially with increasing interest expenses [4] Group 2: Financial Strategy and Future Outlook - Occidental set a target to reduce debt by $4.5 billion within a year of the CrownRock acquisition and achieved 90$1 billion in free cash flow at a WTI crude oil price of around $70 per barrel [6] - Production is increasing, and management is committed to further debt reduction in 2025, alongside investments in OxyChem and carbon capture and storage, which are expected to drive growth [7] - Occidental is likely to raise its dividend again in 2025, following a 22% increase in 2024, positioning the stock as a potential turnaround story [7]