Is the BP share price dirt cheap ahead of Q3 earnings?
- BP share price soared to its year-to-date high.
- Shell and TotalEnergies published strong quarterly results.
- Analysts expect that the company's revenue surged in Q3.
BP (LON: BP) share price popped to the highest level since October 5 after the strong results by Shell. The stock rose to a high of 478p, which was about 13.4% from the lowest level this month. It has rallied by more than 45% this year, making it one of the best-performing stocks in the FTSE 100.
BP earnings ahead
BP is a leading integrated energy company with operations around the world. It has operations across the upstream, midstream, and downstream segments. It has also expanded its business to clean energy through acquisitions.
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BP share price rose sharply on Thursday after Shell delivered strong quarterly results. The firm said that its adjusted earnings of $9.5 billion and an adjusted EBITDA of over $21.5 billion. Most importantly, the company announced a new $4 billion share buyback that will be completed by Q4 of this year.
Therefore, BP shares rose as investors anticipated positive results when it publishes on November 1. The consensus is that BP’s RCP before interest and tax rose to over £10.6 billion in the quarter. By segment, analysts expect that its gas and low carbon business brought in over £3 billion while oil production rose to £5.2 billion. Customers & products is expected to have risen to over £2.57 billion.
Meanwhile, TotalEnergies also had a strong quarter as its net income rose to more than $9.8 billion. That was a significant increase from the $4.77 billion it made in the same period in 2021.
However, BP likely had a more difficult quarter than Shell. For one, the company suffered a major outage in its Whiting refinery in Indiana. The refinery processes more than 435k barrels per day, meaning its revenue will be impacted.
BP share price forecast
The daily chart shows that the BP stock price has been in a strong bullish trend in the past few months. It rose above the important resistance level at 470p, which was the highest point this year. The shares have moved above the 25-day and 50-day moving averages.
The Relative Strength Index (RSI) has continued rising and is close to the overbought level. It has also formed an ascending triangle pattern. Therefore, the stock will likely continue rising as buyers target the next key resistance level at 500p.