You are here: Home - Investing - Experienced Investor - News -

Stock of the week: BP

0
Written by: YourMoney.com
06/08/2018
Helal Miah, investment research analyst at The Share Centre, explains why oil major BP is this week's stock of the week.

This week’s stock of the week is oil giant BP as it released its second-quarter report at the end of July announcing an increased dividend for the first time since 2014 further accentuating its place on the road to recovery.

Underlying replacement cost profits compared to the same period last year surged fourfold to $2.8bn and production of oil was 1.4% higher at 3.6 million barrels of oil equivalent per day as major new projects have come online and plant reliability has been improved.

Its key upstream business experienced the best quarterly performance since before the crash in oil prices in 2014. These divisions performed much better than consensus expectations. However, it seems that the downstream refining industry is still facing a tricky period and profits here fell short of expectations.

The oil industry has been bouncing back for some time now as illustrated by major new project start-ups in Azerbaijan, Russia and Egypt and their acquisition of BHP Billiton’s shale assets in America for $10.5bn; another reflection of this confidence and one that will give BP a more diverse revenues stream.

This is all good news for investors as well as the reduction of the net debt and the increased dividend along with a share buyback scheme.

We believe the much-improved operational efficiency and cost structure will set them up well in the current oil price environment. We maintain our long-standing ‘buy’ recommendation for investors seeking a mixture of growth and income and willing to accept a medium level of risk.

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Your right to a refund if travel is affected by train strikes

There have been a wave of train strikes in the past six months, and for anyone travelling today Friday 3 Febru...

Could you save money with a social broadband tariff?

Two-thirds of low-income households are unaware they could be saving on broadband, according to Uswitch.

How to help others and donate to food banks this winter

This winter is expected to be the most challenging yet for the food bank network as soaring costs push more pe...

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

DIY investors: 10 common mistakes to avoid

For those without the help and experience of an adviser, here are 10 common DIY investor mistakes to avoid.

Mortgage down-valuations: Tips to avoid pulling out of a house sale

Down-valuations are on the rise. So, what does it mean for home buyers, and what can you do?

Five tips for surviving a bear market mauling

The S&P 500 has slipped into bear market territory and for UK investors, the FTSE 250 is also on the edge. Her...

Money Tips of the Week