10 Best Undervalued Energy Stocks To Buy According to Hedge Funds

2. Occidental Petroleum Corporation (NYSE:OXY)

Number of Hedge Fund Investors: 71

Forward P/E Ratio as of December 16: 14.56

Occidental Petroleum Corporation (NYSE:OXY) is a major energy company engaged in oil and gas exploration, production, and marketing. The company operates primarily in the United States, the Middle East, and Latin America. The company’s customers include refiners, utilities, and industrial users.

Occidental Petroleum Corporation (NYSE:OXY) is leveraging its vast acreage in the Permian Basin to utilize existing infrastructure to produce from multiple stacked basins. The company is continually investing in advanced drilling and production techniques to unlock the full potential of its reserves. Infill development, which involves drilling additional wells within existing fields, has been particularly effective in increasing production and extending the life of its assets. By focusing on infill development and leveraging technological advancements, Occidental Petroleum Corporation (NYSE:OXY) aims to add significant reserves without the need for new acquisitions. Occidental Petroleum Corporation (NYSE:OXY) is also diversifying its portfolio by investing in the chemicals business. The company’s OxyChem segment, which includes the tile ground expansion and modernization project, is expected to reach peak construction activity in 2025 and is on track for completion in mid-2026.

The company is advancing its direct air capture (DAC) projects, which are designed to capture carbon dioxide directly from the atmosphere and store it geologically. The company’s STRATOS, the world’s largest DAC facility, with an initial 250,000 tons per annum load capacity expected to come online in mid-2025. Occidental Petroleum Corporation (NYSE:OXY) is also making significant progress on its South Texas DAC project. These investments not only position Occidental Petroleum Corporation (NYSE:OXY) as a leader in carbon management but also create new revenue streams by selling carbon credits on the voluntary market to other businesses and getting government subsidies. The company’s South Texas DAC project recently received up to $500 million in funding from the U.S. Department of Energy.