Stockchase Research Editor: Michael O'Reilly We reiterate our TOP PICK recommendation with BP. As oil prices continue to stabilize and the economy edges forward, this is a good value entry point. It trades at 10x earnings, compared to peers at 14x and is presently valued right near book value. It is paying a good dividend, backed by a payout ratio under 50% of cash flow. It has paid down over $11 billion in debt, while keeping cash reserves relatively steady. We would buy this with a stop loss at $20, looking to achieve $35 -- upside potential over 32%. Yield 4.85% (Analysts’ price target is $34.69)
Had issues with Deep Horizon in the Gulf and took impairments and write downs over the years. Now long in BP in funds. Cheaper of the peers. Good name to own. Exposure to the British pound as well which has some upsides.
Stockchase Research Editor: Michael O'Reilly With Brent oil prices back over $70, the future of oil looks brighter -- especially as the global economy continues to re-open. Shares are trading at 1.1x book value, with a PEG ratio of under 0.6 (good value relative to growth potential). It pays a great dividend, backed by a payout ratio of 45% of cash flow. We would buy this with a stop loss at $20, looking to achieve $32 -- upside potential over 14% (although with such a good yield, we might just trailing up the stop). Yield 4.67% (Analysts’ price target is $31.57)
(A Top Pick Jun 11/19, Down 38%) The stock has recovered. It has proven to be so volatile. He is lightening up on his energy exposure. You may want to hold it for another year or two to get into a more normalized environment.
(A Top Pick May 07/19, Down 45%) BP will be profitable this year because of its downstream operations. They're also cutting edge with their renewable energy division. The dividend will be safe for 12 months, but Brent oil will eventually need to rise for the dividend to survive longer.
A super major energy company. Their growth and capital allocation don't make this compelling at all. EOG-N is much better and will snap back better after this oil sell-down.
(A Top Pick Dec 27/18, Up 3%) Oil prices continue to struggle, but BP pays a big, safe dividend. They generate great return on capital even at current oil prices. They also run fuel stations in Europe and sell natural gas products, not just oil. They're a leader in using data to make equipment use efficient.
Their business is optimized at below-$50/barrel oil while energy prices are slowing creeping higher. Safe dividend over 5% and there's growth ahead. (Analysts’ price target is $50.32)
Huge cash flow. They made a big acquisiton of BHP in 2018 and their timing was impeccable. Pays a 5.5% yield that'll grow. They're a big investor in renewables. A cheap stock at 11x earnings. (Analysts’ price target is $50.32)
(A Top Pick Dec 27/18, Up 14%) BP is how he plays oil. It's the gold standard in oil operations. They've focussed on cost and discipline, using technology to improve recoveries and cost overruns. Even with $50-60 oil, they'll double their cash flow within five years. Pays a safe 6% dividend.
He owns this one and he likes their lack of exposure to WCS oil prices. It is good value here and he expects to see them continue to grow. He would prefer them to SU-T for this reason. Yield 5.8%
We had oil oversupply which pushed down prices. At these levels BP has an attractive yield. Good reserves and balance sheet. He's happy with their current levels.
The oil price is nearing its bottom, he thinks. $45 is the marginal cost of U.S. shale production. BP uses new technology and data to reduce their costs and boost productivity. Even if the oil price stays within $45-65, he thinks BP will still bring on more production. They can increase their free cash flow. Pays a decent yield. (Analysts’ price target is $49.30)
BP recently made a big acquisition that the market liked. Its balance sheet is reasonable and its last earnings results were good. It recently increased its dividend. Oil is finding a level at $70 or higher, which is good for BP.
BP PLC is a American stock, trading under the symbol BP (previously BP-N on Stockchase) on the New York Stock Exchange (BP). It is usually referred to as NYSE:BP or BP
Is BP PLC a buy or a sell?
In the last year, 2 stock analysts issued a Buy, Sell, or Hold rating on BP (previously BP-N on Stockchase). 0 analysts recommended to BUY and 2 analysts recommended to SELL the stock. The latest stock analyst rating is TOP PICK. Read the latest stock experts' ratings for BP PLC.