BP share price: Barclays remains ‘overweight’ on group

Oil major seen on track a year into its five-year plan

BP share price: Barclays remains ‘overweight’ on group

Barclays remains bullish on BP (LON:BP), arguing that the oil major is on track a year into its five-year plan and momentum is building across the business, Citywire reports. The comments came after the blue-chip group recently updated investors on its performance, reporting a surge in profits, having benefitted from an upswing in oil prices.

BP’s share price fell in the previous session, shedding 0.60 percent to close at 475.95p. The shares marginally underperformed the broader UK market, with the benchmark FTSE 100 index falling 9.05 points to end the session 0.13 percent lower at 7,168.01. The group’s shares have added more than three percent to their value over the past year, as compared with about a 1.5-percent dip in the Footsie.

Barclays upbeat on BP

Barclays reiterated its ‘overweight’ stance on BP today, with a price target of 675p on the shares.

“We conclude that progress is on track, if not slightly ahead of plan, with both marketing and manufacturing delivering strong results,” the broker’s analyst Lydia Rainforth commented, as quoted by Citywire. “There is still a long way to go, but momentum across the entire BP business is building and we expect it to become increasingly evident over the coming 12 months that BP can deliver a material and sustained improvement in free cashflow.”

The analyst estimates that by the end of the decade, the downstream dividend and the fixed price part of the upstream business should by themselves “more than cover the dividend, leaving plenty of excess free cashflow for the group to make capital allocation choices”.

Other analysts on group

Morgan Stanley meanwhile downgraded BP to ‘equal weight’ yesterday, trimming its price target on the shares from 645p to 550p. According to MarketBeat, the oil major currently has a consensus ‘hold’ rating and an average price target of 547.94p.

As of 08:20 GMT, Wednesday, 14 February, BP plc share price is 474.75p.

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