BP - Where Do We Go From Here

Summary

• Since the start of the COVID pandemic BP has underperformed other Oil & Gas majors.
• BP is pivoting to being an integrated energy company with a lower carbon footprint.
• We explore the current and forecasted earnings per share for BP and derive future price estimations based on a conservative P/E metric.
• Absent a substantial catalyst from low carbon energy earnings, we see BP's price recovering only to a mid 30s price range.
• Despite its low price target, given the current depressed levels for BP's stock, an investor can realize an annualized total return of over 20% in the next two years.

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Investment Thesis

British Petroleum (NYSE:BP) has underperformed other Oil & Gas majors since the start of the COVID-19 pandemic. It has been very slow to recover from the drawdown induced by COVID and is currently 26% below its January 2020 price. The article discusses

Analyst’s Disclosure:I/we have a beneficial long position in the shares of BP either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.