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TheStreet Open House

Occidental Petroleum's Stock Is on Sale -- But Not for Long

NEW YORK (TheStreet) -- At the end of my last energy-company-related article, I wrote the following: "Meanwhile, if you want to catch the next HES-style energy opportunity, our own Jim Cramer and Stephanie Link like Occidental Petroleum (OXY), which pays a delectable 3.28% current yield-to-price and trades at slightly more than 10 times forward (one-year) earnings."

This is the kind of compelling investment theme that deserves our careful consideration. With a company like OXY, we have an opportunity to "catch a wave" before all the other stock "surfers" know the underlying potential of the "wave" and how rewarding a "ride" lies ahead. This is no April Fool's Day story and that's why I wanted to circle back to OXY and explain why I own it and want to buy more shares.

Speaking of April 1st, this morning just after the markets opened, TheStreet Ratings reiterated its "buy" recommendation on OXY, and the disclosure from the editor is a good place to begin.

"Editor's note: TheStreet Ratings does not represent the views of TheStreet's staff or its contributors. Ratings are established by a computer based on metrics for performance (which includes growth, stock performance, efficiency and valuation) and risk (volatility and solvency). Companies with poor cash flow or high debt levels tend to earn lower ratings in our model."

The above disclosure is important because the "buy" recommendation is done by an unemotional, non-human, computer-based screening analysis of important economic and financial metrics that use straight logic to separate "the wheat from the chaff." It gives the investor a relatively unbiased picture of the kind of companies that have both obvious positive features as well as some inconspicuous ones.

Shares of OXY hit an intraday low of $77.21 on March 26, and since that time the intraday lows and highs have been moving up. On this first day of April, the low was $77.91 and from there the share price headed above $79 after TheStreet Ratings' reiteration.

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