Buffett Receives The Green Light To Buy Half Of Occidental Petroleum

The purchases have been happening in recent months. Berkshire Hathaway, the company run by Warren Buffett, has been acquiring portions of the oil company Occidental Petroleum in recent times and has now received the go-ahead from regulators to take over 50% of the company.

According to a document published on Friday by the Federal Energy Regulatory Commission (FERC), Berkshire requested permission on July 11 to take over half of the oil company, something to which regulators have agreed. .

On that date, Berkshire owned 18.72% of the shareholding of the energy firm, a percentage that has continued to expand since then to touch 20% of the titles.

On the fundamentals side, which has always been Buffett’s hallmark investor, Occidental is benefiting from rising oil prices in recent months, posting $3.7bn in Q2 net profit. .

But in addition to the positive of its accounts, the company’s price has been greatly boosted by the repeated interest of Buffett – who, however, said a few months ago that he did not find interesting options in the market, and since then has not stopped to make different depth inversions. He is trading at a PER (times earnings per share is contained in the share price) of 7.01.

Thus, Occidental Petroleum is revalued by 129.52% so far this year (this Friday it did almost 10% after knowing the approval of the FERC). The US selective of the sector, the S&P 500 Energy, limits its revaluation in this 2022 to 42.79%. The comparables are nowhere near Buffett’s bet, be they Exxon (+48.06%), Chevron (+32.22%) or Marathon Petroleum (52.99%).

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