OXY Faces Earnings With Shorts Building and Options Skewing Cautious

Occidental Petroleum heads into its November 9 earnings report with short sellers rebuilding positions at the fastest clip in months, even as the stock drops 5% on the week and the broader energy sector sells off in lockstep.

The most notable tension right now is the divergence between rising short interest and a lending market that remains completely unbothered. Short positions have grown 14.8% over the past week and 16.4% over the past month, bringing SI to 2.6% of the free float. That is still a low absolute level, but the rate of accumulation is the story: shorts added roughly 3.2 million shares in October alone. The cost to borrow has also risen, up 24% on the week and 80% over the past month to 0.34%. In isolation that sounds alarming, but context matters. Borrow availability is essentially unlimited, with more than 835 million shares available in the lending pool. There is no squeeze pressure, no scarcity, no mechanical bid under the stock. The rising cost to borrow looks more like increased demand from a larger short base than any tightening in supply. Options sentiment adds to the cautious picture: the put/call ratio has climbed to 0.45, almost two standard deviations above its 20-day average of 0.43, and close to its highest reading in the past month. Call-side dominance remains the structural norm for OXY, but the recent drift toward puts suggests hedging activity picked up around the sell-off.

The Street is broadly constructive, though not in a way that explains the stock's recent weakness. Goldman Sachs raised its price target to $76 last week and kept its Buy rating, while Susquehanna and Stephens both lifted targets into the $77 to $80 range in the days before. Morgan Stanley and UBS raised targets more modestly, to $71 and $73 respectively, while maintaining neutral-equivalent ratings. Piper Sandler assumed coverage at Neutral with a $69 target. The consensus mean sits at $70.74, roughly 16% above the current $60.72 close, and the overall rating is Hold, with 16 analysts at that level. Bulls point to the balance sheet recovery after the CrownRock acquisition, with gross debt now under $14 billion from a $29 billion peak, alongside management's plan to deliver around 85% higher sustainable cash flow at a flat $65 WTI price deck through 2029. Bears flag a Q2 international volume miss driven by Middle East disruptions, an uptick in international capital spending to $600 million this year, and continued uncertainty around the Stratos carbon capture project. On valuation, OXY trades at 11.4x trailing earnings and 5.7x EV/EBITDA, with EV/EBITDA drifting lower over the past month. Factor scores are mixed: EPS momentum over 30 and 90 days ranks in the 74th to 84th percentile, and analyst recommendation divergence scores in the 92nd percentile, suggesting the market is more divided on OXY than on most names. Earnings yield ranks 64th, while forward EPS growth scores only in the 17th percentile, the weak growth profile that has kept the total score a step behind larger integrated peers.

The ownership structure gives OXY an unusually large anchor. Warren Buffett's Berkshire Hathaway holds 26.5% of shares per the most recent institutional data, and a Schedule 13G/A from August 2025 put Buffett's disclosed stake at 32.7% of the class. These figures may reflect different counting methods or timing; the 13D/G register, as always, represents stakes as last disclosed and positions can change without a filing below the 5% threshold. Dodge & Cox held 7.5% per its May 2026 13G/A, down from 8.8% previously. BlackRock and Vanguard entities sit in the 5% to 5.5% range, each adding shares in the most recent reported quarter. The Berkshire anchor is relevant context for positioning: with over a quarter of shares locked into a long-term holder, the effective float for short sellers is considerably smaller than headline share counts imply, though the borrow pool size suggests this is not currently a constraint.

On the recent earnings record, OXY has moved positively after each of the last two reported quarters, gaining roughly 1.7% to 3.9% on the day and 6% to 7% over the following five sessions. The peer group has sold off sharply this week alongside OXY: DVN fell 6.7%, APA dropped 7.6%, and OVV lost 6.6%, suggesting the move is sector-wide rather than company-specific. COP and EOG held up slightly better, each down around 4.6%.

With earnings six days away, the question is whether the short-building of the past month reflects a genuine bearish view on the Q3 print, or simply a hedge against sector exposure in a falling oil price environment. Retail attention, per Wikipedia view data, is running well below OXY's own 90-day average, a signal that the upcoming report has not yet captured broad investor interest outside of professional positioning.