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BP (BP) Flat As Market Gains: What You Should Know

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Zacks Equity Research
·3 min read
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BP (BP) closed the most recent trading day at $18.84, making no change from the previous trading session. This change lagged the S&P 500's daily gain of 6%. Meanwhile, the Dow gained 5.2%, and the Nasdaq, a tech-heavy index, added 6.23%.

Coming into today, shares of the oil and gas company had lost 47.67% in the past month. In that same time, the Oils-Energy sector lost 47.86%, while the S&P 500 lost 29.18%.

BP will be looking to display strength as it nears its next earnings release. In that report, analysts expect BP to post earnings of $0.65 per share. This would mark a year-over-year decline of 7.14%. Our most recent consensus estimate is calling for quarterly revenue of $79.61 billion, up 18.1% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.98 per share and revenue of $237.50 billion. These totals would mark changes of -32.88% and -15.96%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for BP. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

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. The Zacks Consensus EPS estimate has moved 30.5% lower within the past month. BP is currently a Zacks Rank #3 (Hold).

Looking at its valuation, BP is holding a Forward P/E ratio of 9.52. This represents a premium compared to its industry's average Forward P/E of 8.65.

Investors should also note that BP has a PEG ratio of 1.06 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Oil and Gas - Integrated - International industry currently had an average PEG ratio of 2.39 as of yesterday's close.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 244, putting it in the bottom 5% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our 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.

You can find more information on all of these metrics, and much more, on Zacks.com.

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Zacks Investment Research