Tortoise Senior Portfolio Manager & Managing Director Rob Thummel joins Asking for a Trend to analyze the oil and gas sector, as Occidental (OXY) stock declines while Diamondback Energy (FANG) gains following their respective fourth quarter reports.
"Big picture in the oil and gas space right now it’s all about capital discipline, it’s about returning cash to shareholders," he tells Yahoo Finance. Thummel suggests Occidental’s stock slide stems from capital spending that’s "a little bit higher than what the street expected," which reduces their free cash flow.
Nevertheless, he maintains that Occidental remains "still attractive," citing its 10% free cash flow yield and ongoing debt reduction efforts.
Regarding Diamondback Energy’s significant acquisition in the US Permian Basin, Thummel notes that "there’s still some opportunity for consolidation" in the oil and gas sector. He adds that this move represents the company’s strategy to "produce oil and gas more efficiently."
To watch more expert insights and analysis on the latest market action, check out more Asking for a Trend here.
https://finance.yahoo.com/videos/series/asking-for-a-trend/
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