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BP (BP) Gains But Lags Market: What You Should Know

Zacks Equity Research

BP (BP) closed the most recent trading day at $44.09, moving +0.85% from the previous trading session. The stock lagged the S&P 500's daily gain of 1.16%. Meanwhile, the Dow gained 1.27%, and the Nasdaq, a tech-heavy index, added 1.29%.

Heading into today, shares of the oil and gas company had gained 2.51% over the past month, outpacing the Oils-Energy sector's gain of 1.02% and the S&P 500's gain of 1.92% in that time.

Wall Street will be looking for positivity from BP as it approaches its next earnings report date. The company is expected to report EPS of $0.67, down 14.1% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $53.02 billion, down 23.33% from the year-ago period.

BP's full-year Zacks Consensus Estimates are calling for earnings of $3.19 per share and revenue of $253.65 billion. These results would represent year-over-year changes of -16.05% and -16.49%, respectively.

Any recent changes to analyst estimates for BP should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. 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.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 1.54% lower. BP is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that BP has a Forward P/E ratio of 13.71 right now. This valuation marks a premium compared to its industry's average Forward P/E of 11.45.

We can also see that BP currently has a PEG ratio of 1.94. 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. Oil and Gas - Integrated - International stocks are, on average, holding a PEG ratio of 1.25 based on yesterday's closing prices.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 70, which puts it in the top 28% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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