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BPPlc. looks fairly valued at the current levels as we don’t see much upside in the stock. The stock finished trading on the London stock exchange on 15th August at 447.0p a share, up by 0.69% compared to previous close. Lately, the stock has been in correction mode and has come down from 470p to 445p in a few days. However, we expect the stock to consolidate around 440p and the stock shall bounce back from that level. Therefore, traders or investors would be advised to keep an eye on Bp Plc. and accordingly initiate fresh buy positions. As of now we won’t recommend to initiate fresh trades in Bp Plc., till the stock is done with its consolidation and correction. In terms of technical analysis or charting, the stock has indicated bearish pattern followed by gap down and red marubozu candles. Although, yesterday, the momentum oscillator RSI indicated a bounce back but we need to get the confirmation of the same. If the stock gives a positive closing in the coming one or two trading sessions, traders or investors can initiate fresh buy positions.

Let’s throw some light on the latest financial results of the company.  As per the management, the company reported solid earnings in first half 2017.  The company reported a profit of $1,593m in first half 2017 versus loss of $2002 m. After adjusting for a net charge for non-operating items of $215 million and net favorable fair value accounting effects of $84 million, underlying RC profit for the second quarter was $684 million, compared with $720 million for the same period in 2016. Excluding post-tax amounts related to the Gulf of Mexico oil spill, operating cash flow for the second quarter and half year was $6.9 billion and $11.3 billion respectively, compared with $5.3 billion and $8.3 billion for the same periods in 2016. (Read more)

Topics: Analysis
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Posted by MaxMarioni on 9 July 2017, 7:18 PM

The declining share values of Oil Majors

Does it still make sense to invest in an oil major? Energy companies have seen their influence on stock markets wane in recent years. In 2012, the S&P 500 value index in the US and the corresponding benchmark index for energy companies showed perfect correlation: now oil and gas companies are performing at half the level of the general market. And on the LSE, BP (BP:L), and Shell (RDSA:L), are not doing much better. (Read more)

Topics: Energy, Oil
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BP Plc. is a ‘Hold’ at current price levels. As mentioned in our last article, that BP Plc. may correct up to 450p and BP PLC did go up to 450p!. The stock finished trading on the London stock exchange at 449p on Wednesday, 15th February.  The stock has been trading 83% above its 52 weeks low and 12% below its 52 weeks high.  Currently, the stock has been trading below its 20 day moving average (DMA), 50 DMA and 100 DMA of 474p, 488p and 476p respectively. Clearly, the stock has been in a downward trend and has been correcting and couldn’t break the resistance at 520p. The immediate support and resistance for the stock is at 455p and 480p respectively. However, the stock seems to be in a consolidation mode and once consolidation is over, the investors can initiate fresh long positions.

(Read more)

Topics: Analysis
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Posted by ShrutiAggarwal on 27 January 2017, 10:28 AM

BP Plc overvalued at current stock prices

BP PLC shall be avoided for the time being as the stock seems to be in a correction and consolidation mode right now. However, even the fundamental analysis and valuation also suggests that the stock is slightly overpriced at the current levels. Therefore, investors or traders shall wait for the stock to consolidate and done with its correction and then initiate fresh longs.

The stock finished trading on the London Stock exchange at 489.7 on 24th January, 0.52% up from the previous close. BP PLC has been trading 5% below its 52 weeks high and 96% above its 52 weeks low. The stock had not been able to breach the resistance at 520 and has been in the correction mode since last few days.  However, significant support zones for the stock lies at 487p and 476p respectively. If the stock goes below 476p also, then the stock may test lows of 460p as well. Therefore, traders and investors shall carefully keep an eye on the prices and levels of the stock and accordingly hedge their positions respectively.  Currently, the stock has been trading above 50 day moving average (DMA), 100 DMA and below 20 DMA of 482p, 470p and 508p respectively.  (Read more)

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BP closes the year with news of one of the biggest deals in the energy sector this year. The British oil companyhas signed a deal which has has made it a shareholder in Abu Dhabi's onshore oil concession, in exchange for which the emirate's oil company gainsownership of a 2% stake in BP. BP obtains, in this way a 10% stake in ADCO, the state-owned Abu Dhabi Company for Onshore Petroleum Operations Limited,the outfit which operates these oil fields. The oil fieldthought to be part of one of the largest oil field concessions in the emirate, and one of the last few big oil concessions available in the Middle East. The total deal is estimated to be worth a total of £1.8 billion ($ 2.2 billion). (Read more)

Topics: Gas, Oil
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BP Plc is ‘Hold’ at the current price levels, considering its spectacular rally, on account of improvement in oil prices! However, the oil giant missed the analyst estimates in its 2016 half yearly results, announced on July 26th.  Also, the latest results of the company indicate significantly lower liquids and gas realizations as well. Although there is an improvement in oil prices, but the company second quarter profits have almost halved compared to a year ago as the company suffered from lower oil prices and weak refining margins. BP Plc’s underlying replacement cost profit for the quarter fell to $720m, which is 44% down compared to $1.3bn profit recorded a year ago. The profit was slightly below analyst’s expectations, as analysts forecast this profit at $839m. BP also announced another cut to its planned investment budget for 2016 to below $17bn. But despite three consecutive quarterly losses, BP Plc did announce its plans to invest in three new projects this year. The projects would include a gas plant in India, a project in Trinidad and the second phase of the Mad Dog deepwater oil field in the Gulf of Mexico. Also the management outlook is pretty positive on these projects and is hopeful that these projects would reap benefits and would increase the production levels to 500,000 barrels of oil per day by the end of next year, and add another 300,000 barrels per day in the next ten years. It surely seems that the oil giant is taking best measures to address the issue of low crude oil prices. Also, in the first half of 2016, BP received $1.9 billion from divestments, including the partial sale of its interest in Castrol India. Therefore, the oil giant is implementing effective strategies to get the company back to profits and despite the losses it continued paying steady dividend to its investors. Because of the stable dividend policy, the oil giant has always been favorite of income oriented investors.

  (Read more)

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Centrica Plc:

In terms of technical analysis, Centrica Plc chart has turned pretty bearish, indicating that bears are in charge, outweighing the bulls. The stock had a resistance at 240 pence twice and couldn’t cross the 240p level. On 5th May, it had given a ‘Gap’ down and even continued falling afterwards. The stock also went below its 20 day, 50 day and 100 day moving average of 225p, 226p and 215p respectively. It finished trading on London Stock exchange on 13th May at 202 p a share. In the near term, the stock would be having immediate support at 196 pence and it may start consolidating around 196 pence. However, the immediate resistance for the stock would be 208 pence. If the stock manages to break the resistance of 208 pence, then we would see Centrica Plc trading in the range of 208p-223p. Therefore, the traders need to watch these levels and hedge their positions respectively. (Read more)

Topics: Analysis
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Posted by ShrutiAggarwal on 8 December 2015, 8:05 AM

Fairly priced BP PLC

BP PLC is fairly priced at the current levels considering the weak performance of the company in 2015 so far. BP PLC is trading 52% above its 52 W low and 22% below its 52 W high. The company finished trading in the London stock exchange at 350p a share on Monday. However, based on the fundamental analysis and valuation we do not see an upside of more than 25% from the current levels.  BP p.l.c. is an integrated oil and gas company and has a market cap of £ 70.66 b. The Company provides its customers with fuel for transportation, energy for heat and light, lubricants and the petrochemicals products used to make everyday items, including paints, clothes and packaging. The Company has three business segments namely, Upstream, Downstream and Rosneft. However, over 80% of the company’s revenue generates from the downstream segment. The Company's Downstream segment's activities include the refining, manufacturing, marketing, transportation, and supply and trading of crude oil, petroleum, petrochemicals products and related services to wholesale and retail customers.

 Like the other oil and gas companies, falling oil prices is a big concern for BP PLC also, as it got validated by  the weak 2014 and cumulative third quarter 2015 results respectively. The company’s topline fell in 2014 compared to 2013 mainly because of falling crude oil prices and lower volumes. However the silver lining in the cloud was the company’s strong balance sheet and gearing ratio within the target range of 20%. The company had a gearing ratio of 16.7% in 2014 which indicates towards its financial stability.  Despite the challenging macro and tough market conditions, BP PLC reported positive cash flow from operations in the first nine months of 2015. BP PLC reported positive cash flows from operations in cumulative third quarter 2015 at $13.327 B versus $25.507 B. Though cash flows have fallen significantly compared to the last year on account of volatility in the oil prices.  BP PLC would seem to be on track once we see some stability in the oil prices.  Another good thing about the oil and gas giant is the stable and steady average dividend yield of approx. 6.5% in 2013 and 2014 respectively.  Despite the negative earnings in 2015 so far, company has full plans to maintain the same in the coming fiscal years as well. BP PLC has already announced the dividend of 30 cents per share in cumulative third quarter 2015. (Read more)

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