Warren Buffett Boosts Occidental Stake Amid Sell-Off

Warren Buffett's Berkshire Hathaway has increased its stake in Occidental Petroleum (OXY) despite a significant sell-off from its record high, indicating the legendary investor's confidence in the company's long-term prospects. In this article, we will explore the factors that led Buffett to boost his stake in Occidental Petroleum and the implications for the company's valuation and future growth prospects.

Berkshire Hathaway's recent purchase of Occidental Petroleum shares comes after the oil and gas producer tumbled more than 30% from its record high. The Omaha, Nebraska-based conglomerate scooped up 763,017 shares of the Houston-based energy company on Friday for $35.7 million, according to a regulatory filing. Berkshire is Occidental's biggest investor, holding a 28.2% stake. Shares of Occidental have fallen nearly 32% from an all-time high reached last April. The stock dropped more than 17% in 2024 as oil prices weakened.



Buffett's firm now has 255.3 million shares of Occidental Petroleum, bringing its stake to 28.8%. Occidental Petroleum is Berkshire's sixth-largest equity holding. Buffett has made clear he won't take full control of the oil company, founded by legendary oilman Armand Hammer. There had been speculation of a takeover after Berkshire received regulatory approval to buy as much as a 50% stake.

The "Oracle of Omaha" previously said he started buying Occidental after reading a transcript of the oil company's earnings conference call. Occidental also pays a 1.8% dividend yield and has been investing in a carbon capture business. Berkshire also owns $10 billion of Occidental preferred stock and has warrants to buy another 83.9 million common shares for $5 billion, or $59.62 each. The warrants were obtained as part of Berkshire's 2019 deal that helped finance Occidental's acquisition of Anadarko Petroleum.

Key Takeaways:

1. Berkshire Hathaway has increased its stake in Occidental Petroleum to 28.8% by purchasing 7.3 million shares between June 5 and June 17, 2025.
2. The prices paid for these shares ranged from $59.58 to $60.43 each.
3. Buffett's firm now has 255.3 million shares of Occidental Petroleum, making it the company's sixth-largest holding.
4. Buffett has praised Occidental Petroleum's CEO, Vicki Hollub, for her leadership and the company's strategic direction.
5. Berkshire Hathaway's investment in Occidental Petroleum aligns with Buffett's value investing philosophy, focusing on undervalued stocks with strong fundamentals and long-term growth prospects.

In conclusion, Warren Buffett's decision to increase his stake in Occidental Petroleum despite the significant sell-off from its record high can be attributed to several specific factors that align with his investment philosophy. These factors include the company's strong fundamentals, dividend yield, carbon capture initiatives, and competent management. By increasing its stake in Occidental Petroleum, Berkshire Hathaway is signaling confidence in the company's long-term prospects and its ability to generate value for shareholders. However, investors should also consider the company's past performance and the current market conditions when evaluating its future prospects.