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BP (BP) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, BP (BP - Free Report) closed at $30.92, marking a -0.48% move from the previous day. This change lagged the S&P 500's daily gain of 1.89%. Meanwhile, the Dow gained 1.17%, and the Nasdaq, a tech-heavy index, added 0.73%.

Coming into today, shares of the oil and gas company had gained 16.67% in the past month. In that same time, the Oils-Energy sector gained 9.61%, while the S&P 500 lost 7.36%.

BP will be looking to display strength as it nears its next earnings release, which is expected to be February 8, 2022. The company is expected to report EPS of $1.18, up 3833.33% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $42.11 billion, down 13.29% from the year-ago period.

It is also important to note the recent changes to analyst estimates for BP. Recent revisions tend to reflect the latest near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 5.81% higher within the past month. BP is currently a Zacks Rank #1 (Strong Buy).

Digging into valuation, BP currently has a Forward P/E ratio of 6.74. This valuation marks a premium compared to its industry's average Forward P/E of 6.13.

It is also worth noting that BP currently has a PEG ratio of 0.49. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Oil and Gas - Integrated - International industry currently had an average PEG ratio of 0.62 as of yesterday's close.

The Oil and Gas - Integrated - International industry is part of the Oils-Energy sector. This group has a Zacks Industry Rank of 9, putting it in the top 4% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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