BP Sources And Sells Energy Worldwide
The energy sector includes six industries all related to bringing oil and gas to market. They are as follows: drilling, exploration, and production (E&P), equipment and services, integrated, midstream, refining & marketing. all such oily and gassy enterprises.
Today I'm reviewing an oil and gas integrated firm. It's a large-cap stock with market capital over $10 billion. Its name is BP plc It's trading ticker symbol is BP.
BP plc is an integrated oil and gas company. Its business activities involve oil and natural gas exploration, midstream transportation, supply and trading of crude oil, petrochemicals products, and related services to wholesale and retail customers.
BP p.l.c. engages in energy business worldwide. It operates through three segments: Upstream, Downstream, and Rosneft.
The Upstream segment is involved in the oil and natural gas exploration, field development, and production; midstream transportation, storage, and processing; and marketing and trading.
The Downstream segment refines, manufactures, markets, transports, supplies, and trades in crude oil, petroleum, and petrochemical products and related services.
The Rosneft segment owns and operates 13 refineries in Russia; and approximately 2,960 retail service stations in Russia and internationally.
BP also produces ethanol, bio-isobutanol, bio-power, and solar energy; transports hydrocarbon products through time-chartered and spot-chartered vessels, and holds interests in 14 onshore wind sites with a generation capacity of 1,432 megawatts through wind.
BP p.l.c. was founded in 1889 and is headquartered in London, the United Kingdom.
I use three key data points gauge the value of any dividend equity or fund like BP plc:
(1) Price
(2) Dividends
(3) Returns
After those three, four more keys will finally unlock an equity or fund in which to invest.
However, it's those first three primary keys that best tell whether a company has made, is making, and will make money.
BP Price
BP's price was $43.91 per share at yesterday's market close. A year ago its price was $34.66 for a gain of $9.25 per share in the past year.
Assuming BP's price will trade between the range of $35.00 to $55.00 next year, its price could grow another $9.25 from $43.91 to $53.16 by April 2019.
BP Dividends
BP's most recent quarterly dividend was $0.60 paid March 29th. Total annual dividend paid in 2017 was $2.40 per share. An expected repeat of the $2.40 amount for 2018 yields nearly 5.5% at yesterdays stock price.
Gains For BP?
The $9.25 estimated year over year price gain plus an anticipated dividend of $2.40 makes a projected gross annual gain of $11.65, which will be reduced by the cost to trade these shares.
$1,000.00 invested today at the $43.91 price buys 23 shares.
A $10 broker fee paid half at purchase and half at sale subtracts about $0.44 per share
Taking that $0.44 brokerage cost out of the estimated $11.65 gross gain leaves a net gain of $11.21 X 23 shares
= $257.83
or a 25.5% potential net gain on a $1009.93 investment.
Therefore, BP plc (whose ticker symbol is BP), now shows a possible 25.5% net gain including a 5.5% dividend yield.
Eleven analysts cover this stock. Four say buy. Four say it will outperform. Two say hold. One sees it underperforming, No one thinks it's time to sell.
The eleven broker analysts consensus recommendation is outperform with a mark at the 2.0 level on the 1 (buy) to 5 (sell) scale.
These eleven brokers also set a median price target at $46.00 which is over $7 or 13% lower than my year over year estimate of $53.16.
The forward-looking numbers were conjecture based on past year performance. Actual results remain to be seen. They could turn out to be far higher or lower. More study is required for you to determine if BP plc is worth your time and money.