Occidental Petroleum Corp. (NYSE:OXY)

Debt to Equity Ratios

The debt to equity ratio shows a consistent decline from 1.95 in 2020 to 0.65 in 2023, followed by a slight increase to 0.76 in 2024. Including operating lease liabilities, the ratio follows a similar pattern, decreasing from 2.01 in 2020 to 0.69 in 2023, and then rising to 0.79 in 2024. This suggests a significant reduction in reliance on debt relative to equity over the first four years, with a modest reversal in the latest period.

Debt to Capital Ratios

Debt to capital has improved steadily from 0.66 in 2020 to 0.39 in 2023, before increasing slightly to 0.43 in 2024. The inclusion of operating lease liabilities results in marginally higher levels, but the trend remains the same. The decline indicates better management of overall capital structure and a reduced proportion of debt financing over the observed periods, with a minor upward adjustment in the most recent year.

Debt to Assets Ratios

The debt to assets ratio has decreased from 0.45 in 2020 to 0.27 in 2023, displaying greater asset coverage and lower debt burden. There is a slight uptick to 0.31 in 2024. Accounting for operating lease liabilities increases the ratio slightly but follows the same trajectory. Overall, the company appears to have strengthened its asset base relative to debt liabilities, with some reversal in the latest period.

Financial Leverage

Financial leverage experienced a significant reduction from 4.31 in 2020 to approximately 2.45 in 2023, indicating diminished reliance on debt to finance assets. It then increased marginally to 2.5 in 2024, suggesting a minor shift towards greater leverage. The declining trend overall reflects an improved capital structure and potentially lower financial risk over the majority of the period.

Interest Coverage

Interest coverage ratio showed dramatic improvement from a negative value of -10.03 in 2020 to positive 14.71 in 2022. Subsequently, the ratio decreased but remained positive, moving to 7.8 in 2023 and 4.46 in 2024. This indicates a recovery from an inability to cover interest expenses in 2020 to strong coverage in 2022, with a notable easing of this strength in the last two years.

Fixed Charge Coverage

Fixed charge coverage followed a similar pattern to interest coverage, increasing from negative 4.0 in 2020 to 6.42 in 2022. It then declined to 3.09 in 2023 and further to 2.26 in 2024. This trend suggests improved ability to cover fixed financial obligations after 2020, with a pronounced reduction in coverage capacity in the most recent two years while remaining in positive territory.

Overall Insights

The data reveals a material deleveraging effort between 2020 and 2023 across multiple measures, including debt to equity, debt to capital, and debt to assets, indicating improved financial stability and lower risk. The improvement in interest and fixed charge coverage ratios also points to enhanced profitability or earnings capacity to meet financial obligations. However, the slight reversal in leverage ratios and reduction in coverage ratios in 2024 suggest emerging pressures or strategic changes affecting capital structure and financial performance. Continuous monitoring is advisable to assess whether the recent shifts represent a short-term fluctuation or the beginning of a new financial trend.

Over the analyzed period, total debt exhibits a declining trend from 2020 through 2023, followed by a notable increase in 2024. Specifically, total debt decreased from $36,185 million in 2020 to $19,738 million in 2023, indicating a significant reduction of approximately 45% over three years. However, in 2024, total debt rose again to $26,116 million, representing an increase of about 32% relative to the previous year.

Stockholders’ equity shows a consistent upward trajectory throughout the period. Starting at $18,573 million in 2020, equity increased steadily each year, reaching $34,159 million by the end of 2024. This represents an overall growth of approximately 84% over the five-year period, suggesting strengthening of the company’s net asset base.

The debt to equity ratio closely mirrors the movements seen in total debt relative to equity. It decreases significantly from 1.95 in 2020 to 0.65 in 2023, reflecting a substantial improvement in the company’s leverage position and indicating reduced reliance on debt financing relative to equity. However, in 2024, the ratio rises to 0.76, consistent with the uptick in total debt, though it remains well below the initial level in 2020.

Overall, the financial data indicate a strategic reduction in debt through 2023 accompanied by steady equity growth, improving the capital structure. The partial reversal in 2024, with increased debt and a higher debt to equity ratio, may warrant closer examination to understand the underlying drivers and potential implications for financial risk and capital management going forward.

Total Debt (Including Operating Lease Liability)

There is a significant decreasing trend in total debt from 2020 to 2022, with the figure dropping from 37,299 million USD in 2020 to 20,765 million USD in 2022. This nearly 44% reduction suggests a strong deleveraging effort during this period. However, in the years 2023 and 2024, this trend reverses slightly as total debt increases to 20,911 million USD and then more notably to 27,104 million USD, indicating possible new borrowings or changes in financing strategies.

Stockholders’ Equity

Stockholders’ equity exhibits consistent growth across the entire period. Beginning at 18,573 million USD in 2020, it progresses steadily to 20,327 million USD in 2021, then surges considerably in 2022 to 30,085 million USD. This upward momentum continues with moderate increases in 2023 and 2024, reaching 34,159 million USD. This pattern demonstrates strengthening financial foundation and increased retained earnings or capital injections over time.

Debt to Equity Ratio (Including Operating Lease Liability)

The debt to equity ratio reflects the changes in debt and equity and trends downward sharply from 2.01 in 2020 to 0.69 by 2022, indicating a substantial improvement in balance sheet leverage and risk profile. The ratio remains stable at 0.69 in 2023, then increases slightly to 0.79 in 2024, paralleling the rise in total debt and suggesting a modest increase in leverage after prior reductions.

Overall Analysis

The data reveals a concerted effort to reduce leverage and improve equity position between 2020 and 2022, contributing to a stronger financial structure. The subsequent increase in debt from 2023 onward, along with continued equity growth, points to strategic shifts possibly aimed at supporting expansion or operational needs while maintaining a relatively conservative leverage ratio below 1. The balance between stable equity growth and cautious debt management underscores prudent financial stewardship.

Total Debt

The total debt decreased significantly from 36,185 million US dollars in 2020 to 19,835 million US dollars in 2022, reflecting a reduction strategy over two years. In 2023, the debt level remained relatively stable at 19,738 million US dollars, showing a plateau after the prior declines. However, in 2024, there was a noticeable increase in total debt to 26,116 million US dollars, indicating a possible shift towards leveraging or increased borrowing in that period.

Total Capital

Total capital exhibited a downward trend from 54,758 million US dollars in 2020 to 49,944 million US dollars in 2021, followed by a stabilization around 49,920 to 49,988 million US dollars during 2022 and 2023. In 2024, there was a marked increase to 60,275 million US dollars, suggesting an expansion in the capital base, which could be attributed to equity issuance, retained earnings growth, or other capital inflows.

Debt to Capital Ratio

The debt to capital ratio showed a consistent decline from 0.66 in 2020 to 0.39 in 2023, indicating an improving capital structure with reduced reliance on debt financing relative to total capital. This trend reflects successful deleveraging efforts over the four years. Nevertheless, in 2024, the ratio increased slightly to 0.43, which corresponds with the rise in total debt during the same period, suggesting a moderate increase in financial leverage.

The financial data reveals several key trends concerning the company's debt level and capital structure over the five-year period ending December 31, 2024.

Total Debt (Including Operating Lease Liability)

The total debt shows a significant decline from 37,299 million USD in 2020 to 20,765 million USD in 2022, indicating a strong deleveraging phase. This reduction stabilizes somewhat in 2023 at 20,911 million USD, but then increases notably to 27,104 million USD by the end of 2024. This suggests that after a period of reducing debt, the company either took on new debt or restructured its liabilities in the latest year.

Total Capital (Including Operating Lease Liability)

The total capital decreased from 55,872 million USD in 2020 to approximately 50,850 million USD in 2022, indicating a contraction in the capital base during these years. However, it shows a gradual increase afterward, reaching 51,161 million USD in 2023 and then rising substantially to 61,263 million USD by 2024. This increase in total capital toward the end of the period may reflect additional equity financing, asset revaluation, or other capital-augmenting activities.

Debt to Capital Ratio (Including Operating Lease Liability)

The debt to capital ratio demonstrates a notable improvement in the company's leverage position between 2020 and 2022, declining from 0.67 to 0.41. This reflects a decreased reliance on debt within the capital structure over this timeframe. The ratio remains stable at 0.41 in 2023 but then slightly increases to 0.44 in 2024, corresponding with the rise in total debt relative to capital. Despite this small uptick, the leverage level remains significantly lower compared to the initial year 2020, indicating a more conservative capital structure.

Overall, the data exhibit a clear pattern of debt reduction and modest capital base contraction up to 2022, followed by capital expansion and a partial rebound in debt levels through 2024. The leverage ratio trends suggest an initial focus on strengthening the balance sheet by lowering debt, with a more balanced approach adopted in the latter years as total capital increased alongside some reaccumulation of debt.

Total Debt

The total debt exhibited a significant downward trend from the end of 2020 to the end of 2022, decreasing from 36,185 million USD to 19,835 million USD. This reduction stabilized slightly in 2023, remaining nearly constant at 19,738 million USD. However, in 2024, there was an increase in total debt to 26,116 million USD, indicating a reversal of the previous decreasing trend.

Total Assets

Total assets decreased from 80,064 million USD in 2020 to a low of 72,609 million USD in 2022, showing a contraction over this period. In 2023, total assets saw a slight recovery to 74,008 million USD, followed by a more pronounced increase reaching 85,445 million USD in 2024, surpassing the 2020 level.

Debt to Assets Ratio

The debt to assets ratio mirrored the trends seen in the absolute values of debt and assets. Beginning at 0.45 in 2020, the ratio declined steadily to 0.27 by the end of 2022 and remained stable through 2023. In 2024, the ratio increased moderately to 0.31, reflecting the rise in total debt relative to the expanded asset base.

The analysis of the financial data reveals significant changes in the debt and asset structure over the five-year period ending December 31, 2024.

Total Debt (including operating lease liability)

The total debt shows a marked decline from $37,299 million at the end of 2020 to $20,765 million by the end of 2022. This represents a substantial reduction in leverage during this period. However, the debt level remained relatively stable between 2022 and 2023, with a slight increase from $20,765 million to $20,911 million. In 2024, there was a notable increase in total debt to $27,104 million, indicating a reversal of the previous downward trend and suggesting increased borrowing or liabilities in that year.

Total Assets

Total assets experienced a decline from $80,064 million at the end of 2020 to $72,609 million at the end of 2022, reflecting a contraction in the asset base. Thereafter, total assets began to recover, increasing modestly to $74,008 million in 2023 and more significantly to $85,445 million in 2024, surpassing the 2020 level. This upward trend in assets in the latter years indicates growth or acquisition activities and a strengthening of the asset base.

Debt to Assets Ratio (including operating lease liability)

The debt to assets ratio decreased consistently from 0.47 in 2020 to 0.29 in 2022, reflecting a reduction in leverage and a stronger asset position relative to debt. This ratio further declined slightly to 0.28 in 2023, indicating continued conservative leverage management. However, in 2024, the ratio increased to 0.32, corresponding with the increase in total debt and growth in assets. Despite this increase, the ratio remains significantly below the 2020 level, suggesting a relatively stable and more conservative leverage position compared to the start of the period.

In summary, the period from 2020 to 2022 was characterized by a strong effort to reduce debt and deleverage the balance sheet, coupled with a decline in assets. The years 2023 and 2024 show a shift, with asset growth and an increase in debt, leading to a moderate rise in leverage, though still below initial levels. This may reflect strategic shifts such as increased investment, capital expenditure, or financing activities during the later period.

The financial data reveals several notable trends over the five-year period ending December 31, 2024. Total assets experienced a decline from US$80,064 million in 2020 to a low of US$72,609 million in 2022, followed by a recovery to US$85,445 million in 2024. This reflects an initial contraction of the asset base over two years, succeeded by asset growth in the subsequent two years, surpassing the initial asset level recorded in 2020.

Stockholders’ equity exhibited steady growth throughout the period. Beginning at US$18,573 million in 2020, equity increased each year to reach US$34,159 million by the end of 2024. This upward trend indicates strengthening capital reserves and an enhancement of the company’s net value to shareholders over the time span.

Financial leverage, expressed as a ratio of total assets to stockholders’ equity, showed a consistent downward trend from 4.31 in 2020 to 2.41 in 2022. Subsequently, the leverage ratio stabilized, inching slightly upward to 2.50 by 2024. This pattern suggests a reduction in reliance on debt or external financing relative to equity during the initial years, followed by a modest increase or plateau in leverage levels.

Overall, the data suggests a strategic strengthening of the balance sheet. The simultaneous increase in equity and the reduction and stabilization of financial leverage imply improved financial stability and potentially lower financial risk. The rebound and growth in total assets after 2022 complement these observations, indicating renewed investments or asset acquisitions supported by stronger equity financing.

Total Assets

Declined from 2020 to 2022, then grew beyond initial levels by 2024.

Stockholders’ Equity

Consistent growth over the entire five-year period, increasing nearly 84% from 2020 to 2024.

Financial Leverage

Significant reduction from 2020 to 2022, followed by stability and slight increase through 2024, indicating decreased dependency on debt relative to equity.

Earnings before interest and tax (EBIT)

The EBIT experienced significant fluctuations over the five-year period. In 2020, the company reported a substantial loss of approximately -14.3 billion US dollars, indicating poor operational performance. This was followed by a strong recovery in 2021, with EBIT turning positive at 5.3 billion US dollars. The upward trend continued more robustly in 2022, reaching a peak of about 15.1 billion US dollars. However, the subsequent years saw a decline, with EBIT decreasing to 7.4 billion in 2023 and further to 5.2 billion in 2024. Despite this decline in recent years, EBIT remained positive compared to the initial loss.

Interest and debt expense, net

Interest and debt expenses showed relatively moderate variation compared to EBIT. The net expense increased slightly from 1.4 billion US dollars in 2020 to 1.6 billion in 2021, then decreased to just above 1 billion in 2022. This reduction may have contributed to the improved earnings in that year. Expenses then modestly declined to 945 million US dollars in 2023 before rising again to 1.2 billion in 2024.

Interest coverage ratio

The interest coverage ratio, which measures the ability to meet interest obligations from operating profits, reflected the trends in EBIT and net interest expense. In 2020, the ratio was strongly negative at -10.03, consistent with the large operating loss and inability to cover interest expenses. This improved markedly to 3.3 in 2021, showing safer coverage. The ratio peaked in 2022 at 14.71, indicating a very strong earnings-to-interest coverage position. The subsequent decline to 7.8 in 2023 and further to 4.46 in 2024 shows decreasing coverage strength, though it remains in a comfortable range above 1.0, indicating ongoing ability to meet interest obligations.

Earnings before fixed charges and tax

The earnings before fixed charges and tax exhibited significant volatility over the five-year period. In 2020, the value was deeply negative at -13,420 million USD, indicating a substantial loss. However, in 2021 there was a marked recovery to a positive 6,137 million USD, followed by further growth to 15,521 million USD in 2022. Subsequently, earnings decreased to 7,772 million USD in 2023 and continued declining to 5,763 million USD in 2024. This pattern suggests a strong rebound after a challenging 2020, with peak performance in 2022, but a downward trend in the most recent two years.

Fixed charges

Fixed charges have remained relatively stable throughout the period, fluctuating slightly but without a clear upward or downward trend. Beginning at 3,353 million USD in 2020, fixed charges increased marginally to 3,445 million USD in 2021. After that, they decreased to 2,417 million USD in 2022 before slightly increasing to 2,511 million USD in 2023 and 2,552 million USD in 2024. Overall, fixed charges appear to be controlled within a relatively narrow range, suggesting consistent expense management in this category.

Fixed charge coverage ratio

The fixed charge coverage ratio showed substantial improvement from 2020 to 2022, followed by a decline in the subsequent years. In 2020, the ratio was negative (-4), indicating insufficient earnings to cover fixed charges. It rose to 1.78 in 2021, signaling the transition to positive coverage. The ratio peaked at 6.42 in 2022, reflecting strong earnings relative to fixed charges. However, the coverage ratio declined to 3.09 in 2023 and further to 2.26 in 2024, indicating reduced but still adequate capacity to meet fixed obligations. This ratio trajectory aligns with the earnings trend, emphasizing a recovery phase culminating in 2022, followed by a moderation in coverage strength.