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Ever since the Deepwater Horizon oil spill, British Petroleum (BP) has been in a funk. Since that day, April 20, 2010, BP stock has gone from $60 to $27 and languished ever since. It has underperformed Exxon Mobil (XOM) and Chevron (CVX) by over 50% in that time span. Despite oil marching higher, better legal visibility, and a great 4.2% dividend, BP's stock is still stuck in neutral.

British Petroleum is a great company. Much of its assets are in geopolitically stable areas such as United States or the North Sea. Additionally, BP should be positioned to capitalize on the BRIC story. As BRICs grow, crude oil demand and price will increase. BP's bottom line will do the same. Its division of TNK-BP in Russia is already contributing 25% of total profits and growing rapidly.

BP still does have unsettled legal liabilities. While it has set aside a total of $41 billion for the spill, the Department of Justice civil suit is still a big worry. It could still be paying $4,300 per barrel spilled if it is found guilty of gross negligence. Rationally however, you have to believe that the US won't persecute BP that much. If it does, oil investment would go down, prices would be even higher, and the nascent US economic recovery will go out the window.

Technically, BP has been stuck in a trading zone between $42 and $46 in one range, and $35 and $42 in another. With the indexes soaring, BP should be increasing as well, but it really hasn't. For the long term investor, picking the absolute bottom shouldn't be an issue, because with the 4.2% dividend, you get paid while you wait for a quality stock. For the short term investor, BP looks to be a buy as well. The stock has bounced strong off $42 before, and assuming the market doesn't crash, it should do so in the future. While holding for $42.50 is optimal, buying around $43 and selling at $46 wouldn't be too bad either.

Disclosure: I am long BP.