Shares of the Houston company were climbing 5.5% to $25.63 in trading Wednesday.
Occidental and other oil companies were hammered by the COVID-19 pandemic, which stifled demand for the commodity.
Analyst John Gerdes, who kept a $32 price target on the shares, said in a research note that Occidental merited the upgrade because the company has depreciated over 20% since early March, compared with the S&P Oil & Gas Exploration & Production ETF (XOP) - Get Report , which was down 15% to 20%, "and reflects approximately 30% equity value upside."
Gerdes said his first-quarter production of roughly 1,123 Mboepd,is fractionally above guidance (1,085-1,115 Mboepd), while his 2021 production forecast of about 1,120 Mboepd is roughly 2% below guidance.
"Our analysis integrates the utilization of the company’s ~$750 million Midland Basin capital spending promote over the next three years," he said.
In noting the risks involved with the oil market, Gerdes said "global crude oil prices are affected by supply and demand, political developments worldwide, pricing decisions and production quotas of OPEC and the volatile trading patterns in the commodity futures markets."
In February, Occidental Petroleum reported a wider-than-expected loss for the fourth quarter.
Occidental posted a net loss of $1.31 billion, or $1.41 a share, narrowed from a loss of $1.34 billion, or $1.50, in the year-earlier period.