Energy companies and banks are doing well in the current rising interest rate environment. On Wednesday, Occidental Petroleum earned an upgrade to its Relative Strength (RS) Rating. It rose to 92, up from 89 the day before and just a few point shy of the best-possible 99 rating. The bump up for Occidental stock comes after the company's profits shot up more than 200% last quarter.
The new 92 Relative Strength Rating means that Occidental stock has outperformed 92% of all stocks over the past year. It especially significant because market research shows that the market's biggest winners typically have an RS Rating north of 80 in the early stages of their moves.
Occidental stock rose about 320% from an 8.52 low on Oct. 30, 2020 to a nearly two-year high 35.75 at the end of last October. Despite market volatility the past few months it continues to trade near that level and it was up fractionally at 34.78 in Wednesday afternoon trading on the stock market today.
Occidental Stock Ranked Among Best
Regarding its other key ratings, Occidental stock has a strong 90 Composite Rating. IBD's Composite Rating combines five separate proprietary ratings of fundamental and technical performance into one easy-to-use rating. The best growth stocks have a Composite Rating of 90 or better.
Additionally, Occidental has a 68 EPS Rating, due to weak profits during the early part of the Covid pandemic. Look for that to improve based on strong gains in recent quarters. Institutional investors are looking ahead though and Occidental has a strong B- Accumulation/Distribution Rating.
In terms fundamentals, Houston-based Occidental Petroleum has posted rising EPS growth over the last four quarters. Sales gains have also increased during the same period.
In its most recent quarter, Occidental recorded a 202% year-over-year jump in earnings to 87 cents a share. That came on the heels of a 117% rise the prior quarter. Revenue last quarter shot up 108% to $6.82 billion, its second quarter in a row of 100%-plus sales growth.
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Occidental stock is trying to complete a cup-without-handle pattern with a 35.85 entry. See if the stock can break out in volume at least 40% above average.
Occidental stock earns the No. 8 rank among its peers in the Oil & Gas-International Exploration & Production industry group. ConocoPhillips, Ovintiv and Apache parent APA are among the top five highly rated stocks in the group.
When looking for the best stocks to buy and watch, one factor to watch closely is relative price strength. IBD's proprietary RS Rating measures technical performance by using a 1 (worst) to 99 (best) score that indicates how a stock's price performance over the last 52 weeks matches up against all other stocks in our database.
Please follow James DeTar on Twitter @JimDeTar
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