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

Zacks Equity Research
Allegion (ALLE) doesn't possess the right combination of the two key ingredients for a likely earnings beat in its upcoming report. Get prepared with the key expectations.

BP (BP) closed at $43.93 in the latest trading session, marking a +0.23% move from the prior day. The stock outpaced the S&P 500's daily loss of 0.09%. Elsewhere, the Dow gained 0.03%, while the tech-heavy Nasdaq lost 0.16%.

Coming into today, shares of the oil and gas company had gained 2.79% in the past month. In that same time, the Oils-Energy sector gained 2.32%, while the S&P 500 gained 2.35%.

Investors will be hoping for strength from BP as it approaches its next earnings release. The company is expected to report EPS of $0.67, down 14.1% from the prior-year quarter. Meanwhile, our latest consensus estimate is calling for revenue of $53.02 billion, down 23.33% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.19 per share and revenue of $253.65 billion. These totals would mark changes of -16.05% and -16.49%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for BP. These recent revisions tend to reflect the evolving nature of short-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. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 1.31% higher. BP currently has a Zacks Rank of #3 (Hold).

In terms of valuation, BP is currently trading at a Forward P/E ratio of 13.74. This represents a premium compared to its industry's average Forward P/E of 12.16.

It is also worth noting that BP currently has a PEG ratio of 1.94. 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. The Oil and Gas - Integrated - International industry currently had an average PEG ratio of 1.4 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 93, putting it in the top 37% 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.

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


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