Posting initial discussion here for OXY as I have been scalping it and looking forward its earnings. These are the reasons I look at OXY
Has a tendency to outperform spy on downturns , Spy downturns allow for an entry
Use natural gas futures as a lead for intraday momentum , can use UNG as well but i just look at CNN in the morning and other energy stocks like BTU , IPI , MOS , NTR to see the sentiment torwards things that are related to natural gas
Has earnings in may and is a Buffet stock ( Rumors of Buffet or whatshisface retiring so possible downward catalyst)
Trades in channel , I usually look for a dip in the morning when Natural gas is positive
China opening is causing energy to go back up again
Ill post more later with TA etc but this is just initial braindump / starter thread.
Did some more reading into OXY and oil plays this weekend. My understanding is this:
OXY is completely unhedged, making it one of the most levered plays on the increase in oil price in Q1
OXY went on a huge rip in Q1 already. This is partially due to the above
Q4 earnings EPS was expected 1.10 with actual 1.48 – a 35% beat
Q1 earnings is tomorrow AH. Expected 2.03
Q4 revenue: expected 7.39bn, actual 8.01bn – an 8.37% beat
Q1 revenue is expected at 8.06bn
I bought some calls expiring Friday. Perhaps this is already priced in with last weeks wild run, but I believe with oil at such elevated levels all throughout Q1, OXY will be a big winner.
Late Friday news came out that Berkshire received approval to be able to purchase up to 50% of OXY and the stock took off. Last time news came out that Buffett bought shares OXY ran for an entire day.
Might be worth watching Monday as I’m sure many will see the news over the weekend and possibly decide to buy in. If I see pre-market momentum then I will create a trade-idea so we can track movement.
Berkshire currently owns 188.5 million common shares of Occidental, equal to a 20.2% position.
Berkshire has warrants to buy another 83.9 million common shares for $5 billion, or $59.62 each. The stake would rise to nearly 27% if Berkshire exercises those warrants.
Berkshire also owns $10 billion of Occidental preferred stock.
Interesting that bump Friday puts it close to the resistance ~72.50 it rejected off in June. Maybe this is the push it needs to get over that, will be watching for rejection or break around that level
OXY looking good in pre-market. Looks like the 74.50 resistance has become support. Next resistance at ~76.50.
Also saw this news article, which kind of lends credence to Berkshire’s interest in the company as a carbon-capture venture which is supposed to be extremely profitable (due to government incentives / payments or something of the like).
