Analysis of Profitability Ratios
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
Profitability Ratios (Summary)
Occidental Petroleum Corp., profitability ratios
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
- Operating Profit Margin
- The operating profit margin exhibited a significant recovery between 2020 and 2021, transitioning from a steep negative value of -79.89% to a positive 17.59%. This upward trend continued strongly into 2022, peaking at 38.32%. However, in the subsequent years, a declining trend is observed with the margin decreasing to 24.21% in 2023 and further down to 16.4% in 2024, indicating a reduction in operational efficiency or increased operational costs after the initial recovery.
- Net Profit Margin
- Similar to the operating profit margin, the net profit margin showed a marked improvement from a negative -83.28% in 2020 to a positive 8.95% in 2021. This positive momentum strengthened substantially in 2022, reaching 36.32%. However, this was followed by a decline in profitability over the next two years, with margins falling to 16.62% in 2023 and 11.43% in 2024. The pattern suggests challenges in maintaining net profitability after the peak year.
- Return on Equity (ROE)
- Return on equity underwent a similar dramatic rebound, rising from -79.85% in 2020 to 11.42% in 2021, and then peaking sharply at 44.22% in 2022. This sharp peak suggests an exceptional return to shareholder equity during that period. However, the following years saw a significant drop-off, with ROE decreasing to 15.52% in 2023 and further declining to 8.95% in 2024, reflecting diminished returns to shareholders after the exceptionally strong performance in 2022.
- Return on Assets (ROA)
- Return on assets moved from a deeply negative figure of -18.52% in 2020 to a modest positive 3.09% in 2021, followed by a substantial increase to 18.32% in 2022. Post-2022, ROA declined to 6.35% in 2023 and further to 3.58% in 2024, mirroring the trend observed in other profitability metrics, with a peak in 2022 and subsequent reduction indicating decreased efficiency in asset utilization.
Return on Sales
Return on Investment
Operating Profit Margin
Occidental Petroleum Corp., operating profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Operating income (loss) | 4,383) | 6,840) | 14,037) | 4,566) | (14,228) | |
| Net sales | 26,725) | 28,257) | 36,634) | 25,956) | 17,809) | |
| Profitability Ratio | ||||||
| Operating profit margin1 | 16.40% | 24.21% | 38.32% | 17.59% | -79.89% | |
| Benchmarks | ||||||
| Operating Profit Margin, Competitors2 | ||||||
| Chevron Corp. | 14.63% | 15.37% | 21.42% | 14.81% | -6.22% | |
| ConocoPhillips | 26.64% | 30.57% | 36.80% | 29.84% | -12.74% | |
| Exxon Mobil Corp. | 14.74% | 16.24% | 19.82% | 11.91% | -14.85% | |
| Operating Profit Margin, Sector | ||||||
| Oil, Gas & Consumable Fuels | 15.84% | 17.63% | 23.01% | 14.73% | -15.83% | |
| Operating Profit Margin, Industry | ||||||
| Energy | 15.84% | 17.57% | 22.71% | 14.61% | -18.01% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Operating profit margin = 100 × Operating income (loss) ÷ Net sales
= 100 × 4,383 ÷ 26,725 = 16.40%
2 Click competitor name to see calculations.
- Operating Income (Loss)
- The operating income exhibited significant volatility over the analyzed periods. In 2020, there was a substantial operating loss amounting to -14,228 million US dollars. However, this shifted dramatically in 2021, recording a positive operating income of 4,566 million US dollars. The upward trend continued strongly in 2022, peaking at 14,037 million US dollars. Subsequently, the operating income declined in the next two years, falling to 6,840 million in 2023 and further to 4,383 million in 2024. This pattern indicates recovery and growth after a severe loss, followed by a reduction in profitability in the most recent years.
- Net Sales
- Net sales increased consistently from 17,809 million US dollars in 2020 to 36,634 million in 2022, reflecting strong revenue growth during this period. However, this growth was not sustained, as net sales declined to 28,257 million in 2023 and further decreased to 26,725 million in 2024. Despite the contraction after 2022, sales in the latest years remained significantly higher than the 2020 baseline, suggesting overall positive revenue momentum with some recent setbacks.
- Operating Profit Margin
- The operating profit margin mirrored the trends observed in operating income and net sales. The margin was deeply negative at -79.89% in 2020, signifying operational inefficiency or distress. It then improved markedly to 17.59% in 2021 and surged to a high of 38.32% in 2022. Thereafter, the margin declined to 24.21% in 2023 and further to 16.4% in 2024, showing a decrease in operational profitability margins but still maintaining a positive return from operations. This progression highlights a recovery from losses, followed by a moderation in profitability.
Net Profit Margin
Occidental Petroleum Corp., net profit margin calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Occidental | 3,056) | 4,696) | 13,304) | 2,322) | (14,831) | |
| Net sales | 26,725) | 28,257) | 36,634) | 25,956) | 17,809) | |
| Profitability Ratio | ||||||
| Net profit margin1 | 11.43% | 16.62% | 36.32% | 8.95% | -83.28% | |
| Benchmarks | ||||||
| Net Profit Margin, Competitors2 | ||||||
| Chevron Corp. | 9.13% | 10.85% | 15.05% | 10.04% | -5.87% | |
| ConocoPhillips | 16.89% | 19.52% | 23.80% | 17.63% | -14.38% | |
| Exxon Mobil Corp. | 9.93% | 10.76% | 13.98% | 8.33% | -12.57% | |
| Net Profit Margin, Sector | ||||||
| Oil, Gas & Consumable Fuels | 10.36% | 11.86% | 16.44% | 9.73% | -14.70% | |
| Net Profit Margin, Industry | ||||||
| Energy | 10.47% | 11.90% | 16.28% | 9.67% | -16.81% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
Net profit margin = 100 × Net income (loss) attributable to Occidental ÷ Net sales
= 100 × 3,056 ÷ 26,725 = 11.43%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Occidental
- The net income exhibited significant volatility over the analyzed period. A substantial loss of $14,831 million was recorded in 2020, followed by a sharp recovery to a positive income of $2,322 million in 2021. This upward trend continued robustly into 2022, reaching a peak net income of $13,304 million. However, the subsequent years showed a decreasing trajectory, with net income falling to $4,696 million in 2023 and further down to $3,056 million in 2024, indicating a potential deceleration in profitability.
- Net Sales
- Net sales showed a strong increasing trend from 2020 to 2022, rising from $17,809 million to $36,634 million. This suggests significant revenue growth during this period. However, net sales declined noticeably in 2023 to $28,257 million and slightly further to $26,725 million in 2024, indicating a downturn in sales after the peak in 2022.
- Net Profit Margin
- The net profit margin mirrored the fluctuations observed in net income. In 2020, a negative margin of -83.28% reflected the substantial loss experienced. It turned positive in 2021 with an 8.95% margin, then sharply improved to 36.32% in 2022, indicating strong profitability. The margin decreased to 16.62% in 2023 and further to 11.43% in 2024, highlighting a reduction in profitability relative to sales in the most recent years examined.
- Summary of Trends
- Overall, the data reveal a pronounced recovery and growth phase between 2020 and 2022, characterized by increasing sales, net income, and profit margins after a significant loss in 2020. However, from 2023 onward, both revenue and profitability indicators declined, suggesting challenges in maintaining peak performance levels achieved in 2022. The decreasing net profit margin despite still positive net income may indicate rising costs or other pressures affecting profitability efficiency.
Return on Equity (ROE)
Occidental Petroleum Corp., ROE calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Occidental | 3,056) | 4,696) | 13,304) | 2,322) | (14,831) | |
| Stockholders’ equity | 34,159) | 30,250) | 30,085) | 20,327) | 18,573) | |
| Profitability Ratio | ||||||
| ROE1 | 8.95% | 15.52% | 44.22% | 11.42% | -79.85% | |
| Benchmarks | ||||||
| ROE, Competitors2 | ||||||
| Chevron Corp. | 11.59% | 13.28% | 22.27% | 11.24% | -4.21% | |
| ConocoPhillips | 14.27% | 22.23% | 38.91% | 17.79% | -9.05% | |
| Exxon Mobil Corp. | 12.77% | 17.58% | 28.58% | 13.67% | -14.28% | |
| ROE, Sector | ||||||
| Oil, Gas & Consumable Fuels | 12.36% | 16.40% | 28.49% | 13.14% | -13.50% | |
| ROE, Industry | ||||||
| Energy | 12.70% | 16.59% | 28.13% | 13.12% | -16.04% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROE = 100 × Net income (loss) attributable to Occidental ÷ Stockholders’ equity
= 100 × 3,056 ÷ 34,159 = 8.95%
2 Click competitor name to see calculations.
- Net Income (Loss) Attributable to Occidental
- The net income showed significant volatility over the observed periods. In 2020, there was a substantial net loss of -14,831 million US dollars. This was followed by a strong recovery in 2021, with net income increasing to 2,322 million US dollars. The upward trend continued sharply in 2022, reaching a peak of 13,304 million US dollars. However, this peak was not sustained, as net income decreased to 4,696 million in 2023 and further declined to 3,056 million in 2024.
- Stockholders’ Equity
- Stockholders’ equity exhibited consistent growth throughout the periods presented. Starting at 18,573 million US dollars in 2020, it steadily increased each year, reaching 20,327 million in 2021 and 30,085 million in 2022. The upward progression continued, albeit at a slower pace, with equity reaching 30,250 million in 2023 and 34,159 million in 2024. This trend signifies a strengthening of the company’s equity base over the five-year span.
- Return on Equity (ROE)
- The return on equity mirrored the fluctuations in net income. It was deeply negative in 2020 at -79.85%, reflecting the large net loss recorded that year. In 2021, ROE turned positive at 11.42%, indicating an improvement in profitability relative to equity. This improvement accelerated in 2022, with ROE peaking at 44.22%, suggesting exceptional profitability that year. However, after 2022, ROE declined substantially to 15.52% in 2023 and further dropped to 8.95% in 2024, indicating reduced returns on the company’s equity base despite continued growth in equity.
Return on Assets (ROA)
Occidental Petroleum Corp., ROA calculation, comparison to benchmarks
| Dec 31, 2024 | Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | ||
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net income (loss) attributable to Occidental | 3,056) | 4,696) | 13,304) | 2,322) | (14,831) | |
| Total assets | 85,445) | 74,008) | 72,609) | 75,036) | 80,064) | |
| Profitability Ratio | ||||||
| ROA1 | 3.58% | 6.35% | 18.32% | 3.09% | -18.52% | |
| Benchmarks | ||||||
| ROA, Competitors2 | ||||||
| Chevron Corp. | 6.87% | 8.17% | 13.76% | 6.52% | -2.31% | |
| ConocoPhillips | 7.53% | 11.42% | 19.91% | 8.91% | -4.31% | |
| Exxon Mobil Corp. | 7.43% | 9.57% | 15.10% | 6.80% | -6.74% | |
| ROA, Sector | ||||||
| Oil, Gas & Consumable Fuels | 6.93% | 9.04% | 15.53% | 6.59% | -6.36% | |
| ROA, Industry | ||||||
| Energy | 7.04% | 9.02% | 15.14% | 6.48% | -7.40% | |
Based on: 10-K (reporting date: 2024-12-31), 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31).
1 2024 Calculation
ROA = 100 × Net income (loss) attributable to Occidental ÷ Total assets
= 100 × 3,056 ÷ 85,445 = 3.58%
2 Click competitor name to see calculations.
The financial data reveals significant fluctuations in the company's net income and overall profitability over the analyzed periods. A detailed assessment points to notable variances in key performance indicators.
- Net Income (Loss) Attributable to Occidental (US$ in millions)
- The company experienced a substantial loss of $14,831 million as of December 31, 2020. Subsequently, net income turned positive in 2021, with $2,322 million recorded. The upward trend continued sharply in 2022, reaching a peak of $13,304 million. However, the profitability declined in the following years to $4,696 million in 2023 and further down to $3,056 million in 2024. This pattern suggests a recovery phase after a significant loss, followed by a tapering of profit gains in the more recent years.
- Total Assets (US$ in millions)
- Total assets decreased from $80,064 million in 2020 to $72,609 million by the end of 2022, indicating a contraction or divestment over the period. The asset base showed signs of recovery beginning 2023, increasing to $74,008 million and further expanding to $85,445 million in 2024. This resurgence in asset value correlates with the periods following improved net income performance, implying possible reinvestments or asset acquisitions aligned with profitability growth.
- Return on Assets (ROA, %)
- Return on assets exhibited a strong negative value at -18.52% in 2020, coinciding with the significant net loss. ROA improved markedly, turning positive at 3.09% in 2021, followed by a peak at 18.32% in 2022, which aligns with the peak net income year. However, this profit efficiency metric declined thereafter, dropping to 6.35% in 2023 and 3.58% in 2024, reflecting diminished asset profitability despite the asset base increase.
In summary, the company demonstrated a recovery trajectory from a heavy loss in 2020, posting strong profitability in 2022 before experiencing a contraction in net income and return efficiency in the subsequent two years. The asset base, after an initial reduction, expanded again in 2023 and 2024, which may signal strategic shifts in asset management and investment corresponding to evolving financial performance.