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BP to Acquire EDF ES to Boost US Retail Gas Power Presence

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BP plc (BP - Free Report) signed an agreement to acquire EDF Energy Services (“ES”) as part of plans to enhance its presence in the commercial and industrial retail power space of the United States.

EDF ES supplies power, natural gas and related services to commercial and industrial customers across the United States. It usually serves public entities, which involve retailers, universities, manufacturers and producers, municipalities, and power generators.

With the acquisition, BP will be able to expand its energy solutions and additional services for customers in new and existing markets. The company will be well-positioned to capitalize on EDF ES’ extensive geographical coverage, and diverse commercial and industrial customers.

EDF ES provides products and services for renewable and low-carbon energy to support decarbonization for commercial and industrial customers. Hence, the deal is expected to create opportunities to deliver low-carbon integrated energy solutions for customers.

BP has been the largest marketer of natural gas in North America and a leading power marketer in the United States for more than two decades. The acquisition will grant customers access to opportunities across the energy value chain. It will enable BP to provide integrated solutions to assist in decarbonizing, managing energy consumption and increasing reliability.

BP has set an aggressive energy transition plan to capitalize on the mounting clean energy demand. The company aims to provide customers with secure, affordable and low-carbon energy, while creating value for its shareholders. The latest agreement, subject to regulatory approvals, is expected to complete by the end of 2022.

Price Performance

Shares of the company have outperformed the industry in the past six months. The stock has gained 13.3% compared with the industry's 10% growth.


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Zacks Rank & Other Key Picks

BP currently carries a Zack Rank #2 (Buy).

Investors interested in the energy sector might look at the following companies that presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.

Schlumberger Limited (SLB - Free Report) is the largest oilfield services player, with a presence in every energy market across the globe. For 2022, Schlumberger revised its revenue outlook upward to at least $27 billion.

Schlumberger has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of B for Value and Growth. SLB is expected to see earnings growth of 57.8% in 2022. 

Cactus Inc. (WHD - Free Report) is involved in manufacturing, designing and selling wellhead and pressure control equipment. At the second-quarter end, Cactus had cash and cash equivalents of $311.7 million, which can provide it with immense financial flexibility. WHD has a strong balance sheet. It revealed that it has no bank debt outstanding as of Jun 30, 2022.

Cactus has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of B for Momentum and Growth. WHD is expected to see earnings growth of 143% in 2022. 

Murphy USA Inc. (MUSA - Free Report) is a leading independent retailer of motor fuel and convenience merchandise in the United States. MUSA remains committed to returning excess cash to its shareholders through continued share buyback programs. The fuel retailer approved a repurchase authorization of up to $1 billion, which will commence once the existing $500-million authorization expires and be completed by Dec 31, 2026.

Murphy USA has witnessed upward earnings estimate revisions for 2022 and 2023 in the past 30 days. The company currently has a Zacks Style Score of A for Momentum, and B for Value and Growth. MUSA is expected to see earnings growth of 62.7% in 2022.

In-Depth Zacks Research for the Tickers Above

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BP p.l.c. (BP) - free report >>

Schlumberger Limited (SLB) - free report >>

Murphy USA Inc. (MUSA) - free report >>

Cactus, Inc. (WHD) - free report >>

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