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BP (BP) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
Zendesk (ZEN) has an impressive earnings surprise history and currently possesses the right combination of the two key ingredients for a likely beat in its next quarterly report.

BP (BP) closed at $44.13 in the latest trading session, marking a -1.98% move from the prior day. This change lagged the S&P 500's daily loss of 0.22%. At the same time, the Dow lost 0.22%, and the tech-heavy Nasdaq lost 0.23%.

Heading into today, shares of the oil and gas company had gained 2.74% over the past month, outpacing the Oils-Energy sector's gain of 2.49% and lagging the S&P 500's gain of 4.87% in that time.

Investors will be hoping for strength from BP as it approaches its next earnings release, which is expected to be April 30, 2019. On that day, BP is projected to report earnings of $0.68 per share, which would represent a year-over-year decline of 12.82%. Our most recent consensus estimate is calling for quarterly revenue of $63.24 billion, down 8.53% from the year-ago period.

BP's full-year Zacks Consensus Estimates are calling for earnings of $3.42 per share and revenue of $281.07 billion. These results would represent year-over-year changes of -10% and -7.46%, respectively.

Investors might also notice recent changes to analyst estimates for BP. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 7.33% higher. BP is currently sporting a Zacks Rank of #3 (Hold).

Investors should also note BP's current valuation metrics, including its Forward P/E ratio of 13.15. Its industry sports an average Forward P/E of 11.46, so we one might conclude that BP is trading at a premium comparatively.

We can also see that BP currently has a PEG ratio of 1.86. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. BP's industry had an average PEG ratio of 1.75 as of yesterday's close.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 171, which puts it in the bottom 33% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow BP in the coming trading sessions, be sure to utilize Zacks.com.


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