Occidental Petroleum pushes higher after Buffett’s latest buy, Cowen upgrade (NYSE:OXY)

Occidental Petroleum (NYSE:OXY) +2.9% in Tuesday’s trading after top shareholder Berkshire Hathaway bought nearly 3.7M shares in recent days, raising its ownership stake to ~23.6%.

Cowen upgraded Occidental (OXY) shares to Outperform from Market Perform with a $70 price target, raised from $63, saying the company “stands out as a name with resilient assets that continue to benefit from productivity improvements and attractive reserve bookings, and longer term, should be uniquely positioned to increase EOR related reserves from enhanced CO2 economics.”

“We see a superior risk-reward profile given exposure to higher crude pricing, capital structure shifts, captive buying support from Berkshire Hathaway, a favorable free cash yield, well productivity and a differentiated catalyst rich profile in a world of relative homogeneity across E&Ps,” Cowen’s David Deckelbaum wrote.

The analyst also likes Occidental’s (OXY) position in carbon capture and storage, citing unique tax efficient benefits that also could benefit from funding catalysts that would inherently boost free cash flow profiles.

Look for Berkshire Hathaway to continue opportunistically investing in Occidental Petroleum (OXY) until it eventually acquires the company, The Value Portfolio writes in an analysis published recently on Seeking Alpha.