BP share price: Oil major expected to post first-quarter loss
BP Plc (LON:BP) is expected to post a first-quarter per share loss when it updates investors on its performance next week, as it continues to battle with the ongoing oil price weakness. The update will follow last week’s investor revolt which saw about fifty-nine percent of the group’s shareholders vote against a pay deal for BP’s chief executive Bob Dudley.
BP’s share price has been subdued this morning, having lost 1.68 percent to 362.40p as of 08:59 BST, underperforming the blue-chip FTSE 100 index which currently stands 0.74 percent in the red at 6,334.43 points. The group’s shares have lost nearly a quarter of their value over the past year, but are up over two percent in the year-to-date.
IG reports that analysts expect BP to report a loss of 10 cents per share for its first quarter, as compared with earnings of 85 cents per share for the same period a year ago. Revenues meanwhile are expected to have fallen by 26 percent year-on-year.
“After a tough year, BP needs to put a good spin on its outlook to avoid a crashing disappointment for investors,” IG market analyst Chris Beauchamp said in a note, adding that the group’s outlook for the coming year will be the key to the share price performance.
Jasper Lawler at CMC Markets meanwhile commented that profits at BP’s downstream business, which has so far been ‘a saving grace’, are likely to be more subdued this quarter because of pressure on refining cracks and margin indicators.
“The upturn in oil prices since mid-February has seen BP shares get a modest boost, making them a little over-valued compared to future earnings,” the analyst pointed out in a note this week.
HSBC, which remains bullish on BP with a ‘buy’ rating, set a price target of 410p on the stock yesterday, while Jefferies continues to see the company as a ‘hold,’ valuing the stock at 340p. BP’s results are due out on Tuesday, April 26.
As of 09:21 BST, Friday, 22 April, BP plc share price is 362.55p.