Occidental Petroleum Corp. (NYSE:OXY)

Debt to Equity Ratios

The debt to equity ratio declined significantly from 1.97 in March 2021 to a low of 0.62 in June 2024, indicating a substantial reduction in leverage relative to equity. Following this period, there is a slight uptick toward the end of the series, reaching 0.77 in September 2024 before gradually decreasing again to 0.67 by June 2025. When including operating lease liabilities, the trend is very similar, with ratios consistently marginally higher, reflecting the additional obligations from leases but maintaining the same overall pattern.

Debt to Capital Ratios

This ratio shows a consistent decline from 0.66 in March 2021 down to a range between 0.38 and 0.44 in the later periods, indicating a reduction in the proportion of debt within the company’s total capital structure. The inclusion of operating lease liabilities inflates these ratios slightly but does not alter the declining trend. The ratios stabilize somewhat between 0.38 and 0.44 starting around mid-2024, suggesting a leveling in capital structure adjustments.

Debt to Assets Ratios

The debt to assets ratio demonstrates a downward trend from 0.45 in the first quarter of 2021 to approximately 0.26-0.31 during 2024 and 2025. This reflects decreasing reliance on debt financed by the company’s total asset base. Similar to other leverage metrics, incorporating operating lease liabilities results in slightly higher figures but follows the same trajectory, highlighting cautious but steady deleveraging efforts over time.

Financial Leverage

Financial leverage, measured as a ratio, decreased markedly from 4.34 in March 2021 to a low near 2.36 by mid-2025. This decline indicates reduced reliance on borrowed funds relative to equity and internal financing sources. The ratio stabilizes around the 2.4 to 2.5 range starting from late 2022, showing that financial structure changes slowed after an initial period of significant improvement.

Interest Coverage Ratio

The interest coverage ratio, which evaluates the company's ability to service interest expenses, displayed considerable volatility over the period. It started at a negative value (-8.1) early in 2021, indicating poor coverage and likely operational difficulties or losses at that time. Subsequently, there is a strong and rapid improvement, peaking at approximately 15.23 in the first quarter of 2023, signaling robust earnings relative to interest obligations. However, this coverage ratio declined steadily afterward to 3.83 by June 2025, implying a reduced but still positive capacity to meet interest expenses with operating earnings.

Overall Trends and Insights

The company exhibits a clear overall trend toward deleveraging from early 2021 through to mid-2024, reflected by reductions in all key debt ratios and financial leverage. This suggests prudent financial management and a strengthening balance sheet during this timeframe. However, slight upticks in leverage metrics from mid-2024 onward may indicate some renewed borrowing or capital structure adjustments. The interest coverage improvement from negative into healthy positive territory confirms an operational turnaround or improvement in earnings. The subsequent decline in interest coverage despite stable debt ratios could suggest either a decrease in operating profitability or rising interest expenses. Continuous monitoring of these ratios is warranted to assess the sustainability of financial health going forward.

The financial data for the company over the reported periods shows several notable trends in its capital structure, specifically in terms of total debt, stockholders’ equity, and the debt-to-equity ratio.

Total Debt

The total debt level exhibits a general downward trend from March 31, 2021 (US$36,025 million) through June 30, 2024 (US$19,737 million), indicating a significant reduction in debt over this period. However, there is a reversal in this trend starting in September 30, 2024, where total debt rises noticeably to US$26,635 million, followed by a slight but consistent decrease through mid-2025, settling at US$23,775 million. This suggests an initial effort in deleveraging followed by a strategic increase in leverage in late 2024.

Stockholders’ Equity

Stockholders’ equity generally increases throughout the entire span from US$18,300 million in March 31, 2021 to US$35,722 million in June 30, 2025. This steady growth demonstrates an accumulation of shareholder value, with particularly strong increases observed between the first quarter of 2022 and the end of 2024. Equity values slightly fluctuate in the final observed periods but maintain an overall upward trajectory.

Debt to Equity Ratio

The debt-to-equity ratio reflects the relative proportions of debt and equity financing. It decreases significantly from 1.97 in the first quarter of 2021 to a low of 0.62 around mid-2024. This decline aligns with the observed debt reduction and equity increase, indicating a shift towards a more conservative capital structure with less reliance on debt. However, a reversal appears after this point, with the ratio increasing to approximately 0.77 by September 30, 2024, coinciding with the rise in total debt observed in the same period. Subsequently, the ratio decreases moderately towards 0.67 by the middle of 2025, suggesting some rebalancing after the increase in leverage.

Overall, the company demonstrated a strong focus on reducing financial leverage and strengthening its equity base in the first three years, contributing to a more robust balance sheet. The late 2024 increase in debt, accompanied by a temporary rise in the debt-to-equity ratio, indicates strategic borrowing likely aimed at funding specific initiatives or investments while maintaining an overall manageable leverage profile by mid-2025.

Total Debt (including operating lease liability)

The total debt demonstrates a consistent downward trend from March 2021 to June 2024, decreasing from $36,394 million to $20,147 million. This suggests a deliberate reduction in leverage over this period. However, from September 2024 onward, total debt exhibits an uptick, reaching $25,987 million by March 2025, before declining again slightly to $24,174 million in June 2025. This pattern indicates a possible strategic borrowing or restructuring phase in the later periods.

Stockholders’ Equity

Stockholders’ equity shows a steady and generally continuous increase throughout the entire period. Starting at $18,300 million in March 2021, it grows to $32,053 million by June 2024 and further to $35,722 million by June 2025. The upward movement reflects retained earnings growth, capital infusions, or appreciation in asset values, signaling strengthening equity capital over time.

Debt to Equity Ratio (including operating lease liability)

The debt to equity ratio declines significantly from 1.99 in March 2021 to a low of 0.63 in June 2024, indicating a substantial improvement in the company's capital structure with reduced financial leverage relative to equity. Starting in September 2024, the ratio rises again to 0.78, maintaining that level through June 2025, which corresponds with the increase in total debt during the same period. Despite this temporary increase, the ratio remains considerably lower than the initial levels observed in early 2021.

Overall Trends and Insights

The company exhibits a clear strategic focus on deleveraging from early 2021 until mid-2024, as reflected by the consistent reduction in total debt and corresponding drop in the debt to equity ratio. The improvement in stockholders’ equity over this period supports a strengthened financial position. The subsequent increase in debt and debt to equity ratio in late 2024 through mid-2025 suggests a potential shift in financing strategy, possibly for growth investments or capital expenditures. Despite this increase, the financial leverage remains moderate compared to historical levels, implying maintained financial prudence.

Total Debt

The total debt shows a general declining trend from March 2021 to June 2024, decreasing from approximately $36 billion to around $19.7 billion. However, from June 2024 onward, there is a notable increase in debt levels, rising to about $26.6 billion by September 2024 before gradually decreasing again to roughly $23.8 billion by June 2025. This indicates initial efforts to reduce leverage, followed by a period of increased borrowing, and then a moderate reduction later in the timeline.

Total Capital

Total capital experiences a gradual decline from approximately $54.3 billion in March 2021 to nearly $49.9 billion in December 2023. Starting in March 2024, capital begins to rise significantly, peaking at around $61.3 billion in September 2024 before slightly decreasing to the mid-$59 billion range by June 2025. This pattern suggests a phase of capital contraction followed by a substantial increase in the company's capital base, potentially due to equity issuance or asset revaluation.

Debt to Capital Ratio

The debt-to-capital ratio declines sharply from 0.66 in March 2021 to a low of about 0.38 in June 2024, reflecting a strong reduction in financial leverage over this period. Following this low, the ratio increases to approximately 0.43 by September 2024 and remains relatively stable thereafter, around 0.40 to 0.43 through June 2025. This indicates that while leverage was reduced significantly initially, the subsequent period shows a moderate increase in reliance on debt financing relative to total capital.

The financial data exhibits notable trends regarding the company's debt levels and overall capital structure over the analyzed periods. A clear pattern of debt reduction is observed from early 2021 through mid-2024, followed by an increase starting in the third quarter of 2024.

Total debt (including operating lease liability)

From March 2021 to June 2024, total debt progressively decreased from approximately $36.4 billion to around $20.1 billion. This represents a substantial reduction in leverage over this time frame. However, beginning in September 2024, a reversal in this trend is evident, with total debt increasing sharply to $27.0 billion by September 2024, before gradually declining again to about $24.2 billion by June 2025.

Total capital (including operating lease liability)

Total capital fluctuated moderately over the period, with initial values near $54.7 billion in early 2021 declining slightly to roughly $50.0 billion by late 2021. Subsequently, capital levels generally stabilized between $49.0 billion and $52.2 billion through mid-2024. Starting in September 2024, a significant increase is observed, with total capital reaching approximately $61.7 billion and remaining close to $60.0 billion through mid-2025.

Debt to capital ratio (including operating lease liability)

The debt to capital ratio demonstrates a marked improvement in leverage management from 0.67 in early 2021 to a low near 0.39 by mid-2024, reflecting a lower proportion of debt in the capital structure. This ratio remained relatively stable around 0.40 until mid-2024. From September 2024 onward, the ratio rose again to approximately 0.44 but then decreased slightly to around 0.40 by mid-2025, indicating fluctuations in leverage corresponding with changes in debt and capital levels.

In summary, the data reflects a period of consistent debt reduction and improved leverage up to mid-2024, accompanied by generally stable capital. The latter part of 2024 shows a reversal with an increase in both debt and total capital, temporarily elevating leverage, followed by a mild reduction in debt-to-capital ratio by mid-2025. These dynamics suggest active management of capital structure with a focus on deleveraging initially, and later adjustments potentially related to strategic financing or investment activities.

Total Debt

The total debt demonstrates a clear downward trend from the first quarter of 2021 through the mid-2024 period. Initially, the debt was approximately $36 billion in early 2021, decreasing steadily to below $20 billion by the end of 2023 and first half of 2024. However, starting in the third quarter of 2024, the total debt increased noticeably, reaching over $26 billion, before declining again toward roughly $23.8 billion by the second quarter of 2025. This pattern suggests a period of debt reduction followed by a temporary increase and then another reduction phase.

Total Assets

Total assets display relative stability with minor fluctuations over the reported quarters. The asset base remained around the $75 billion to $79 billion range from early 2021 until early 2024, showing a slight decrease then a modest recovery. From mid-2024 onwards, total assets increased more significantly, peaking at over $85 billion in late 2024 and maintaining levels above $84 billion into mid-2025. This upward movement in assets towards the later periods indicates asset growth and possible investment or capital accumulation during that time frame.

Debt to Assets Ratio

The debt to assets ratio exhibits a general declining trend from approximately 0.45 in early 2021 to around 0.26 in the first half of 2024, reflecting an improved balance sheet with lower leverage relative to asset base. This decrease correlates with the reduction in total debt and stable asset values during that period. Starting in the third quarter of 2024, the ratio rises again to approximately 0.31, coinciding with the increase in total debt and asset growth, indicating a slight increase in leverage. It then slightly decreases back toward 0.28 by mid-2025, reflecting a modest deleveraging towards the end of the observed period.

Overall Analysis

The company appears to have pursued a strategy of debt reduction through early 2024, improving its leverage position significantly. This is reflected in the consistent decrease in total debt and the declining debt to assets ratio. Following this period, an increase in borrowing is observed, which coincides with a growth in total assets, suggesting possible capital investments or acquisitions funded by debt. The subsequent modest reduction in debt and leverage toward mid-2025 signals a return to a more conservative balance sheet management. The fluctuations in leverage metrics and asset size point to dynamic financial management aimed at balancing growth opportunities with maintaining reasonable debt levels.

Total Debt (Including Operating Lease Liability)

The total debt shows a general declining trend from March 2021 through June 2024, decreasing from approximately 36,394 million US dollars to a low around 20,147 million US dollars. This decline suggests a consistent effort to reduce leverage over this period. However, starting from September 2024, the total debt rises sharply to 27,011 million US dollars before gradually decreasing again to 24,174 million US dollars by June 2025. This indicates a brief increase in debt levels toward the end of the period after the prolonged reduction phase.

Total Assets

Total assets exhibit mild fluctuations but remain relatively stable within a range of roughly 74,000 to 80,000 million US dollars between March 2021 and June 2024. From September 2024 onwards, a marked increase is observed, peaking near 85,803 million US dollars in September 2024, followed by a slight downtrend toward June 2025, ending just above 84,000 million US dollars. This pattern indicates an asset base that was stable for most of the period but experienced growth in the later quarters.

Debt to Assets Ratio (Including Operating Lease Liability)

The debt to assets ratio declines consistently from 0.46 in March 2021 to approximately 0.26–0.27 during the first half of 2024, indicating a gradual reduction in leverage relative to the company's asset base and improved financial stability. A subsequent increase occurs starting in September 2024, with the ratio rising to 0.31 and remaining around that level through June 2025. This suggests a temporary increase in financial leverage toward the end of the observed timeframe, corresponding with the increase in total debt and assets noted above.

Overall Analysis

The data reflect a strategic overarching effort to deleverage throughout the majority of the period analyzed, supported by steady asset levels and declining debt ratios. The reversal of this trend in late 2024, marked by rising debt and assets, along with the increased debt to asset ratio, may point to new capital investments, acquisitions, or other operational changes necessitating higher leverage. While the company maintained relatively strong asset bases, the increased financial leverage toward the end of the timeline calls for careful monitoring of debt management and asset quality going forward.

Total Assets

The total assets exhibit a generally declining trend from March 31, 2021, when they stood at approximately $79.4 billion, decreasing steadily throughout 2021 and into early 2022, reaching a low around $72.1 billion in September 2022. Following this trough, assets demonstrate a recovery phase, with a gradual increase that continues through 2023 and into 2024. The upward momentum becomes more pronounced in late 2024, with total assets rising to approximately $85.8 billion by September 2024, before slightly decreasing towards mid-2025 to about $84.4 billion.

Stockholders’ Equity

Stockholders’ equity shows a consistent and solid upward trajectory over the examined period. Starting from about $18.3 billion in the first quarter of 2021, equity increases steadily each quarter, with notable acceleration in growth from early 2022 onward. By the end of 2024, equity reaches around $34.7 billion, almost doubling the initial value in just under four years. This upward movement continues into 2025, with equity climbing further to roughly $35.7 billion by mid-year, indicating strengthening capital backing and potentially improved retained earnings or capital injections.

Financial Leverage

Financial leverage ratios reveal a significant decline from early 2021 through late 2022. The ratio decreases from approximately 4.34 in March 2021 to a trough near 2.4 by December 2022, indicating a substantial deleveraging trend where equity has grown relative to total assets or liabilities have been reduced. From 2023 onward, the leverage ratio stabilizes within a narrow range between 2.36 and 2.5, reflecting a more controlled and consistent capital structure. This relatively stable leverage level suggests a maintained balance between debt and equity financing strategies during the recent periods.

Summary

Overall, the financial data depict a period of asset contraction followed by recovery, alongside a steady and robust accumulation of stockholders’ equity. The decreasing financial leverage ratio over the initial years transitioning into a stable range implies a strategic effort to strengthen the company's balance sheet and reduce reliance on debt. The combination of increasing equity and relatively stable leverage towards the latter part of the timeline indicates improved financial health and potentially enhanced resilience against volatility in the operating environment.

Earnings before interest and tax (EBIT)

The EBIT demonstrates notable volatility across the periods analyzed. Starting at 710 million USD in the first quarter of 2021, it declined to 528 million USD in the subsequent quarter but surged significantly to a peak of 5100 million USD by mid-2022. Following this peak, EBIT gradually decreased through the remainder of 2022 and into early 2023, stabilizing in the range of approximately 1500 to 2000 million USD. From early 2024 onwards, EBIT experienced further fluctuations, showing a downward trend with quarters like the last quarter of 2024 and the first quarter of 2025 reporting significantly lower values (e.g., 158 million USD in December 2024). This pattern indicates periodic strong performance intervals followed by downturns, highlighting cyclical or market-sensitive operational dynamics.

Interest and debt expense, net

Interest and debt expenses remained relatively stable over the entire timeline, generally fluctuating between approximately 230 and 395 million USD. There was a slight decline starting from a higher point of 395 million USD in the first quarter of 2021 down to a lower range near 114 million USD by mid-2022, indicating possible debt repayment or refinancing activities that reduced interest burden temporarily. Subsequently, these expenses showed moderate oscillations, generally in the 230 to 327 million USD range, without extreme spikes or drops.

Interest coverage ratio

This ratio improved significantly from strongly negative or modestly positive values in early 2021 (e.g., -8.1 to 3.3) to substantially higher levels by late 2021 and mid-2022, peaking at 15.23 in early 2023. This improvement signals enhanced ability to cover interest expenses through operating earnings, likely supported by the peak in EBIT during 2022. However, after reaching peak coverage ratios, there was a gradual decline starting in mid-2023 onwards, falling to levels around 3.83 by mid-2025. Although the ratio remains positive, this downward trend reflects diminishing EBIT relative to interest expenses, suggesting reduced cushion for servicing debt in more recent periods.