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BP (BP) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

BP (BP) closed the most recent trading day at $41.22, moving +0.66% from the previous trading session. This move outpaced the S&P 500's daily gain of 0.45%. Elsewhere, the Dow gained 0.29%, while the tech-heavy Nasdaq added 0.75%.

Heading into today, shares of the oil and gas company had lost 3.28% over the past month, lagging the Oils-Energy sector's gain of 2.37% and the S&P 500's gain of 3.84% in that time.

Wall Street will be looking for positivity from BP as it approaches its next earnings report date. In that report, analysts expect BP to post earnings of $0.82 per share. This would mark a year-over-year decline of 3.53%. Meanwhile, our latest consensus estimate is calling for revenue of $79.79 billion, up 3.74% from the prior-year quarter.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $3.22 per share and revenue of $301.77 billion. These totals would mark changes of -15.26% and -0.65%, 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 such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

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 5.72% lower. BP is currently sporting a Zacks Rank of #5 (Strong Sell).

Digging into valuation, BP currently has a Forward P/E ratio of 12.72. Its industry sports an average Forward P/E of 12.19, so we one might conclude that BP is trading at a premium comparatively.

Meanwhile, BP's PEG ratio is currently 1.8. 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 1.85 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 247, which puts it in the bottom 4% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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