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

Zacks Equity Research

BP (BP) closed at $36.96 in the latest trading session, marking a +1.09% move from the prior day. The stock outpaced the S&P 500's daily gain of 0.86%. At the same time, the Dow added 0.79%, and the tech-heavy Nasdaq gained 0.73%.

Coming into today, shares of the oil and gas company had lost 6.76% in the past month. In that same time, the Oils-Energy sector lost 1.43%, while the S&P 500 gained 1.94%.

BP will be looking to display strength as it nears its next earnings release. On that day, BP is projected to report earnings of $0.66 per share, which would represent a year-over-year decline of 36.54%. Meanwhile, our latest consensus estimate is calling for revenue of $76.29 billion, down 0.77% from the prior-year quarter.

BP's full-year Zacks Consensus Estimates are calling for earnings of $2.90 per share and revenue of $282.29 billion. These results would represent year-over-year changes of -23.68% and -7.06%, respectively.

It is also important to note the recent changes to analyst estimates for BP. These revisions help to show the ever-changing nature of near-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. 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, 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 2.03% lower. BP is currently a Zacks Rank #3 (Hold).

Digging into valuation, BP currently has a Forward P/E ratio of 12.6. This represents a discount compared to its industry's average Forward P/E of 12.76.

Meanwhile, BP's PEG ratio is currently 1.33. 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 1.76 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 181, which puts it in the bottom 30% 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.

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


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