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BP (BP) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, BP (BP) closed at $38.59, marking a +0.13% move from the previous day. The stock outpaced the S&P 500's daily gain of 0.03%. Elsewhere, the Dow gained 0.13%, while the tech-heavy Nasdaq lost 0.11%.

Prior to today's trading, shares of the oil and gas company had gained 5.73% over the past month. This has lagged the Oils-Energy sector's gain of 8.57% and outpaced the S&P 500's gain of 4.17% in that time.

BP will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $0.75, down 34.78% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $81.58 billion, up 0.96% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $3.06 per share and revenue of $293.85 billion, which would represent changes of -19.47% and -3.26%, respectively, from the prior year.

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Investors should also note any recent changes to analyst estimates for BP. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 3.12% lower. BP currently has a Zacks Rank of #3 (Hold).

Looking at its valuation, BP is holding a Forward P/E ratio of 12.58. This represents a premium compared to its industry's average Forward P/E of 12.53.

Also, we should mention that BP has a PEG ratio of 1.25. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. BP's industry had an average PEG ratio of 1.74 as of yesterday's close.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This industry currently has a Zacks Industry Rank of 225, which puts it in the bottom 13% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow BP in the coming trading sessions, be sure to utilize Zacks.com.


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Zacks Investment Research